Serial No.

STRICTLY PRIVATE AND CONFIDENTIAL

AMBANK (M) BERHAD
(Company No: 8515-D) (Incorporated in Malaysia under the Companies Act, 1965)

INFORMATION MEMORANDUM
IN RELATION TO THE PROPOSED ISSUE OF, OFFER FOR SUBSCRIPTION OR PURCHASE OF, OR INVITATION TO SUBSCRIBE FOR OR PURCHASE OF, SENIOR NOTES OF UP TO RM7.0 BILLION IN NOMINAL VALUE PURSUANT TO A SENIOR NOTES ISSUANCE PROGRAMME

Principal Adviser, Lead Arranger and Lead Manager

AmInvestment Bank Berhad
(Company No. 23742-V) (a member of AmInvestment Bank Group)

This Information Memorandum is dated 25 February 2010

IMPORTANT NOTICE AmBank (M) Berhad (“AmBank”) has prepared this Information Memorandum (“IM”), which is being provided on a confidential basis to potential investors in relation to the issuance of senior notes of up to RM7.0 billion in nominal value (“Senior Notes”) to be issued under a senior notes issuance programme (“Senior Notes Issuance Programme”). The Securities Commission (“SC”) has approved the issuance of the Senior Notes vide its letter dated 24 February 2010 pursuant to Section 212 of the Capital Markets and Services Act, 2007, as amended from time to time (“CMSA”). Please note that the SC’s approval shall not be taken to indicate that the SC recommends the subscription or purchase of the Senior Notes. The Senior Notes may not be issued, offered, sold, transferred or otherwise disposed of, directly or indirectly, nor may any document or other material in connection therewith including this IM be distributed, in Malaysia other than to persons, whether as principal or agent, falling within any one of the categories of persons specified in Schedule 6 or Section 229(1)(b) or Schedule 7 or Section 230(1)(b) and Schedule 9 or Section 257(3) of the CMSA subject to any law, order, regulation or official directive of Bank Negara Malaysia (“BNM”), the SC and/or any other regulatory authority from time to time. It is a condition to the first issuance that the Senior Notes Issuance Programme is assigned a rating of AA3 by RAM Rating Services Berhad. A rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the rating agency. This IM may not be, in whole or in part, reproduced or used for any other purpose, or shown, given, copied to or filed with any other person including, without limitation, any government or regulatory authority except with the prior consent of AmBank or as required under Malaysian laws, regulations or guidelines. The persons preparing this IM have made all enquiries as were reasonable in the circumstances and after making such enquiries have reasonable grounds to believe and do believe up to the time of the issue of this IM that the information herein is true and not misleading and there is no material omission therein. This IM or any document delivered under or in relation to the Senior Notes Issuance Programme is not, and should not be construed as a recommendation by AmBank, AmInvestment Bank Berhad (“AmInvestment Bank” or “Lead Arranger/Lead Manager”) and/or any other party to subscribe for or purchase the Senior Notes. Further, the information contained herein should not be read as a representation or warranty, express or implied, as to the merits of the Senior Notes or the purchase thereof. This IM is not a substitute for, and should not be regarded as, an independent evaluation and analysis. Each recipient should perform and is deemed to have made his/its own independent investigation and analysis of AmBank, the Senior Notes and all other relevant matters, including but not limited to the information and data set out in this IM, and each recipient should consult its own professional advisers. AmBank confirms that, to the best of its knowledge and belief: (a) this IM contains all information with respect to AmBank and its subsidiary companies that is material in the context of the purpose for which this IM is issued, (b) the information and data contained in this IM are true, accurate and not misleading in all material respects, and (c) there is no material omission of any information and data from this IM. No representation, warranty or undertaking, express or implied, is given or assumed by the Lead Arranger/Lead Manager as to the authenticity, origin, validity, accuracy or completeness of such information and data or that the information or data remains unchanged in any respect after the relevant date shown in this IM. The Lead Arranger/Lead Manager have not accepted and will not accept any responsibility for the information and data contained in this IM or otherwise in relation to the Senior Notes Issuance Programme and shall not be liable for any consequences of reliance on any of the information or data in this IM, except as provided by Malaysian laws.

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This IM has not been and will not be made to comply with the laws of any jurisdiction outside Malaysia (“Foreign Jurisdiction”), and has not been and will not be lodged, registered or approved pursuant to or under any legislation of (or with or by any regulatory authority or other relevant body of) any Foreign Jurisdiction and it does not constitute an offer of, or an invitation to subscribe for or purchase the Senior Notes or any other securities of any kind by any party in any Foreign Jurisdiction. This IM is not a and is not intended to be a prospectus. By accepting delivery of this IM, each recipient agrees to the terms upon which this IM is provided to such recipient as set out in this IM, and further agrees and confirms that: (a) it will keep confidential all of such information and data, (b) it is lawful for the recipient to receive this IM and to subscribe for, purchase or in any other way to receive the Senior Notes under all jurisdictions to which the recipient is subject, (c) the recipient will comply with all the applicable laws in connection with such subscription, purchase or acceptance of the Senior Notes, (d) AmBank and all other parties involved in the preparation of this IM and their respective directors, officers, employees, agents and professional advisers are not and will not be in breach of the laws of any jurisdiction to which the recipient is subject to as a result of such subscription, purchase or acceptance of the Senior Notes and they shall not have any responsibility or liability in the event that such subscription or acceptance of the Senior Notes is or shall become unlawful, unenforceable, voidable or void, (e) it is aware that the Senior Notes can only be transferred or otherwise disposed of in accordance with the relevant selling restrictions and all applicable laws, (f) it has sufficient knowledge and experience in financial and business matters to be capable of evaluating the merits and risks of subscribing for or purchasing the Senior Notes and is able and prepared to bear the economic and financial risks of investing in or holding the Senior Notes, (g) it is subscribing for, purchasing or accepting the Senior Notes for its own account, and (h) it, at the point of issuance of the Senior Notes, falls within one or more of the categories of persons to whom an offer or invitation to subscribe for or purchase the Senior Notes would constitute an excluded issue, excluded offer or excluded invitation pursuant to Schedule 6 or Section 229(1)(b) or Schedule 7 or Section 230(1)(b) and Schedule 9 or Section 257(3) of the CMSA (subject to any law, order, regulation or official directive of BNM, the SC and/or any other regulatory authority from time to time), and after the point of issuance of the Senior Notes, falls within one or more of the categories of persons to whom an offer or invitation to subscribe for or purchase the Senior Notes would constitute an excluded offer or excluded invitation pursuant to Schedule 6 or Section 229(1)(b) and Schedule 9 or Section 257(3) of the CMSA (subject to any law, order, regulation or official directive of BNM, the SC and/or any other regulatory authority from time to time). For the avoidance of doubt, this IM shall not constitute an offer or invitation to subscribe or purchase the Senior Notes in relation to any recipient who does not fall within item (h) above. Each recipient is solely responsible for seeking all appropriate expert advice as to the laws of all jurisdictions to which it is subject. Neither the delivery of this IM nor the offering, sale or delivery of any Senior Notes shall in any circumstance imply that the information contained herein concerning the Issuer is correct at any time subsequent to the date hereof or that any other information supplied in connection with the Senior Notes is correct as of any time subsequent to the date indicated in the document containing the same. The Lead Arranger/Lead Manager expressly does not undertake to advise any investor in the Senior Notes of any information coming to their attention. The recipient of this IM or the potential investors should review, inter-alia, the most recently published documents incorporated by reference into this IM when deciding whether or not to purchase any Senior Notes. This IM includes certain historical information and reports thereon derived from sources believed to be reliable and other publicly available information. Such information and reports have been included solely for illustrative purposes. No representation or warranty is made as to the accuracy of any information and report thereon derived from such and other third party sources. This IM includes “forward looking statements”. These statements include, among other things, disclosure of AmBank’s business strategy and expectation concerning its position in the Malaysian economy, future operations, liquidity, financial position and settlement of indebtedness. Such forwardlooking statements involve known and unknown risks, uncertainties and other factors, which may affect actual outcomes, many of which are outside the control of AmBank. All these statements are based on assumptions made by AmBank that, although believed to be reasonable, are subject to risks and uncertainties that may cause actual events and the future results of AmBank to be materially

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different from that expected or indicated by such statements and no assurance is given that any of such statements will be realised. Therefore, the contingencies and inherent uncertainties underlying such information should be carefully considered by investors and the inclusion of a forward looking statement in this IM is not a representation or warranty by AmBank or any other person that the plans and objectives of AmBank will be achieved. Further, such parties are not under any obligation to update or revise such forward-looking statements to reflect any change in expectations or circumstances. Any difference in the expectations of AmBank and its actual performance may result in AmBank’s financial and operating performance and plans being materially different from those anticipated. The information in this IM supersedes all other information and materials previously supplied (if any) to the recipients. By taking possession of this IM, the recipients are acknowledging and agreeing and are deemed to have acknowledged and agreed that they will not rely on any previous information supplied. No person is authorised to give any information or data or to make any representation or warranty other than as contained in this IM and, if given or made, any such information, data, representation or warranty must not be relied upon as having been authorised by the Issuer, the Lead Arranger / Lead Manager or any other persons. All discrepancies (if any) in the tables included in this IM between the listed amounts and totals thereof are due to, and certain numbers appearing in this IM are shown after rounding off.

DOCUMENTS INCORPORATED BY REFERENCE All information and statements herein are subject to the detailed provisions of the respective agreements referred to herein and are qualified in their entirety by reference to such documents.

ACKNOWLEDGEMENT AmBank hereby acknowledges that it has authorised the Lead Arranger/Lead Manager to circulate or distribute this IM on its behalf in respect of the Senior Notes Issuance Programme to prospective investors and that no further evidence of authorisation is required.

STATEMENTS OF DISCLAIMER – SECURITIES COMMISSION This IM will be lodged with the SC, who takes no responsibility for its contents. Such lodgement shall not be taken to indicate that the SC recommends the Senior Notes. The SC shall not be liable for any non-disclosure on the part of the Issuer and assumes no responsibility for the correctness of any statement, opinion or report contained in this IM. EACH ISSUE OF PRIVATE DEBT SECURITIES (IN THIS CASE, THE ISSUE OF THE SENIOR NOTES) WILL CARRY DIFFERENT RISKS. INVESTORS MUST RELY ON THEIR OWN EVALUATION TO ASSESS THE MERITS AND RISKS OF AN INVESTMENT IN ANY ISSUE OF THE SENIOR NOTES. IT IS RECOMMENDED THAT PROSPECTIVE INVESTORS CONSULT THEIR OWN LEGAL, FINANCIAL AND OTHER ADVISERS BEFORE PURCHASING OR ACQUIRING THE NOTES.

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a wholly-owned subsidiary of ANZ Automated Teller Machines The Banking and Financial Institutions Act. 004 594 343). amendment or re-enactment thereof for the time being in force Bank Negara Malaysia Board of Directors of AmBank Bursa Malaysia Securities Berhad (Company No. 005 357 522) ANZ Funds Pty Ltd (Company No. unless otherwise indicated. the following definitions shall apply: Act : The Companies Act. amendment or re-enactment thereof for the time being in force AMMB Holdings Berhad (Company No. 635998-W) Commercial Business Centres Clear Goal Sdn Bhd (Company No. 1166-T) AMFB Holdings Berhad (Company No. 2007 or any statutory modification. 736317-V) The Capital Markets and Services Act.DEFINITIONS For the purpose of this IM. 1989 or any statutory modification. amendment or re-enactment thereof for the time being in force Electronic Banking Channels Extraordinary General Meeting AMFB AmIslamic Bank AmInvestment Bank : : : AmLife ANZ : : ANZ Funds : ATMs BAFIA : : BNM Board Bursa Securities CBCs CGSB CMSA : : : : : : EBCs EGM : : -v- . 657000-X) AIGB and its subsidiaries AmBank (M) Berhad (8515-D) AHB AHB Group AIGB AIGB Group AmBank or the Bank or the Issuer AmBank Group or Group Amcorp : : : : : : : AmBank and its subsidiaries Amcorp Group Berhad (formerly known as AmcorpGroup Berhad) (Company No. a member of the AIGB Group AmLife Insurance Berhad (15743-P) Australia and New Zealand Banking Group Limited (Company No. 5493-X) AmIslamic Bank Berhad (Company No. 295576-U) AmInvestment Bank Berhad (23742-V). 1965 or any statutory modification. 223035-V) AHB and its subsidiaries AmInvestment Group Berhad (Company No.

763588-T) Regional Business Centres Ringgit The Securities Commission of Malaysia Senior notes issued pursuant to the Senior Notes Issuance Programme Proposed issuance by AmBank of up to RM7.00 each in AmBank Small Medium Enterprises The trust deed entered or to be entered into between the Issuer and the Trustee constituting the Senior Notes Pacific Trustees Berhad (Company No. 317001-A) Tan Sri Dato’ Azman Hashim United States of America IPS IT MBf Capital MBf Finance MBFC : : : : : MDIC : MTN MTN Programme : : NPLs RAM Ratings RBCs RM SC Senior Notes : : : : : : Senior Notes Issuance Programme Share(s) SMEs Trust Deed : : : : Trustee TSDAH US : : : All references to. .00 each Information Technology MBf Capital Berhad (Company No.0 billion in nominal value of Senior Notes under a senior notes issuance programme Ordinary share(s) of RM1. 8515-D) Malaysia Borneo Finance Corporation (M) Berhad (Company No. 227890-W) MBf Finance Berhad (Company No. “us”.0 billion Ringgit-denominated subordinated medium term notes under an existing programme Non-Performing Loans RAM Rating Services Berhad (Company No.vi - .DEFINITIONS FYE HP IBA : : Financial Year Ended Hire Purchase The Islamic Banking Act. 8515-D) Malaysia Deposit Insurance Corporation (Perbadanan Insurans Deposit Malaysia) Medium Term Notes Issuance of up to RM2. amendment or re-enactment thereof for the time being in force 6% irredeemable non-cumulative convertible preference shares of RM1. 1983 or any statutory modification. “we”. “our” and any derivative thereof in this IM refer to AmBank.

......54 5....................................5 1........ RISK MANAGEMENT ................................................1 3.....................57 Commentaries on Past Performance ........................................................................................................................... EXECUTIVE SUMMARY ...................................68 6......................1 Description of the Transaction and Structure of the Senior Notes Issuance Programme .....................................................4 5...............................1 1......... 4...........................................................................3 4..78 INDUSTRY OVERVIEW ....................................................................7 2......................................................................................................................3 3................................................1 Details of Utilisation of Proceeds ....1 8.......27 Australia & New Zealand Banking Group Limited (“ANZ”) ........82 Commitments and Contingent Liabilities....................4 1............ FINANCIAL INFORMATION ..................................................1 5.....................................................82 8...................................4 SUMMARY OF THE PRINCIPAL TERMS AND CONDITIONS OF THE SENIOR NOTES ISSUANCE PROGRAMME.........................................4 4..............6 1....................................................2 3.........................................................................5 4..................................................................................66 Asset Quality................2 Conflict of Interest and Appropriate Mitigating Measures ................26 4.......................................................................51 Strategy ....................................................11 History and Background Information on AmBank.............................................................. OTHER INFORMATION ....................83 AUDITED FINANCIAL STATEMENTS FOR THE FINANCIAL PERIOD 1 APRIL 2008 TO 31 MARCH 2009 APPENDIX I ......................................10 4.......................................41 Competitive Strengths .....................................................................2 1......................................................vii - .............TABLE OF CONTENTS Page 1.......................... 7..................................26 Group Internal Reorganisation ..........................................................................................................................................19 Considerations Relating to the Senior Notes.......................82 Material Litigation ....6 Financial Highlights .........................................................................................................2 8................2 Rating of the Senior Notes Issuance Programme.......2 4................25 Forward Looking Statements.................33 AmBank’s Businesses..............................................................................6 INVESTMENT CONSIDERATIONS ...................................................3 Material Contracts .............................................................81 8.....................27 Corporate Information ...........................................................................64 Capital Adequacy .......................4 Considerations Relating to the Malaysian Banking Industry ..........................1 4..31 Principal Subsidiary of AmBank..............61 Capitalisation and Indebtedness .......................................3 5...............2 5............8 4..57 5........................................ DESCRIPTION OF THE ISSUER ...........................18 3.................................................2 Approvals Required ............................63 Funding ....................... Background Information on AmBank ..........................................................................26 Business Overview ........................5 5.............................81 Prospects for 2010 .........................................6 4..................................................................2 Selling Restrictions .........25 3........81 7.............................................................................................32 Information on Directors and Senior Management..........................................................................................................................................................................................................29 Subsidiaries of AmBank ...........................7 4.......................................................................2 Financial Sector Developments ......................1 7................................................................................................................1 1..........................9 4..3 1.......................................................18 Considerations Relating to the AmBank Group..............................................................

remittance services. EXECUTIVE SUMMARY The executive summary is a summary of information on the Senior Notes Issuance Programme.363. Pursuant to a restructuring scheme. As at 11 December 2009.250.002 Shares and 2. On 20 December 2001. advances and financing. provided that the total outstanding nominal value of Senior Notes shall not exceed the limit of RM7.000 IPS respectively were issued and fully paid-up.000. the Issuer is given the flexibility to issue Senior Notes at any time during the tenor of the Senior Notes Issuance Programme. of which 670.250.762 Shares and 150. 1. MBf Capital was listed on the Main Board of Bursa Securities in place of MBf Finance effective from 15 January 1993 and consequently MBf Finance was delisted. with MBf Capital assuming the listing status of MBf Finance. liens or rights of set-off arising from the normal course of business.000. MBFC was listed on the Main Board of the stock exchange now known as Bursa Malaysia Securities Berhad on 8 June 1983 and changed its name to MBf Finance Berhad (“MBf Finance”) on 19 December 1985. is to meet the Issuer’s long-term funding requirements and to facilitate the Issuer in enhancing its liquidity risk management activities. the authorised share capital of AmBank is RM3. except those obligations preferred by law.2 Description of the Transaction and Structure of the Senior Notes Issuance Programme Under the Senior Notes Issuance Programme.500. the Issuer may issue Senior Notes with a tenure of more than one (1) year and up to ten (10) years provided that the Senior Notes mature prior to the expiry of the Senior Notes Issuance Programme. MBf Finance then changed its name to AmFinance Berhad before assuming its present name. The Senior Notes Issuance Programme shall have a tenor of up to thirty (30) years from the date of first issuance under the Senior Notes Issuance Programme. deposit services.886.0 billion in nominal value at any point in time. credit cards. AmBank is a licensed bank and finance company under BAFIA and it provides banking and financial services which include loans. AmBank (M) Berhad on 1 June 2005. Arab-Malaysian Finance Berhad (now known as AMFB Holdings Berhad and a wholly-owned subsidiary of AMMB Holdings Berhad (“AHB”)) acquired 100% of MBf Finance.000 IPS. MBf Finance became a wholly-owned subsidiary of MBf Capital Berhad (“MBf Capital”). The executive summary should be read in conjunction with the full text of this IM.1 Background Information on AmBank AmBank was incorporated in Malaysia under the Act on 25 March 1969 as a public limited company. Under the Senior Notes Issuance Programme.386. under the name of Malaysia Borneo Finance Corporation (M) Berhad (“MBFC”). The rationale for the establishment of the Senior Notes Issuance Programme.1. Investors should read and understand the whole IM prior to deciding whether or not to invest in the Senior Notes Issuance Programme. AmIslamic Bank Berhad) Islamic banking services. 1. which shall rank pari-passu with all other present and future unsecured and unsubordinated obligations (excluding deposits) of the Issuer. The date of the first issuance under the Senior Notes Issuance Programme shall not be later than 24 months from the date of approval by the SC. -1- . foreign exchange and (through its wholly-owned subsidiary.002 comprising 1.

directly or indirectly.3 Details of Utilisation of Proceeds Proceeds from the issuance of the Senior Notes shall be utilised for the Issuer’s general working capital requirements and to defray issuance expenses for the establishment of the Senior Notes Issuance Programme.5 Selling Restrictions At issuance The Senior Notes may not be offered. 1. nor may any document or other material in connection therewith be distributed in Malaysia other than to persons falling within Schedule 6 or Section 229(1)(b) or Schedule 7 or Section 230(1)(b). nor may any document or other material in connection therewith be distributed in Malaysia other than to persons falling within Schedule 6 or Section 229(1)(b) and Schedule 9 or Section 257(3) of the CMSA. 1.6 Approvals Required The Senior Notes Issuance Programme has been approved by the SC vide its letter dated 24 February 2010. Waivers sought in relation to the SC’s Trust Deed Guidelines Item references relate to paragraphs in the SC’s Trust Deed Guidelines Item 14. and Schedule 9 or Section 257(3) of the CMSA. substantial shareholder or persons connected with them) unless:Revised clause as approved by the SC Save and except for transactions lawfully entered into by the Issuer in the ordinary course of its banking and/or financial services business or such other incidental business(es) with its or its related corporations’ directors. discount or at par and the coupon rates shall be determined prior to issuance. After issuance The Senior Notes may not be offered. whether directly or indirectly with interested persons (including a director. waived the inclusion or amendment of the following provisions of the SC’s Guidelines on the Minimum Contents Requirements for Trust Deeds in the Trust Deed (“SC’s Trust Deed Guidelines”).4 Rating of the Senior Notes Issuance Programme As at the date of this IM. 1.1 Covenants by Borrower Clause as provided in the SC’s Trust Deed Guidelines As a minimum. 1. sold or delivered. sold or delivered. The Senior Notes may be issued at a premium. the trust deed must provide for the following covenants of the borrower: (iii) that the borrower will not enter into a transaction. The SC has also vide said letter. directly or indirectly.The Senior Notes may be issued via private placement on a best effort basis (via direct placement or bought-deal) and/or book building on a best effort basis without prospectus. substantial shareholders or persons connected with any of them (“Interested Persons”) and recurring transactions with Interested Persons approved by the -2- . RAM Ratings has assigned a long-term rating of AA3 to the Senior Notes Issuance Programme.

where applicable. and that the transaction has been approved by the majority of its board of directors and.g. where applicable.The rest of this page has been left blank intentionally - -3- . the borrower obtains certification from an independent adviser that the transaction is carried out on fair and reasonable terms. shareholders of the Issuer. (vi) to keep proper books and accounts at all times and to provide the trustee and any person appointed by it (e. the Issuer shall obtain certification from an independent adviser that the transaction is carried out on fair and reasonable terms. shareholders at a general meeting. and (ii) with respect to transactions involving an aggregate payment or value equal to or greater than 25% of the Issuer’s total shareholders’ funds as reflected in the latest audited financial statements. auditors) access to such books and accounts. the Issuer has received the certification referred to in this sub-paragraph (ii).(a) such transaction shall be on terms that are no less favourable to the borrower than those which could have been obtained in a comparable transaction from persons who are not interested persons. PROVIDED that the borrower certifies to the trustee that the transaction complies with paragraph (a). that the borrower has received the certification referred to in paragraph (b) (where applicable) and that the transaction has been approved by the majority of the board of directors or shareholders in a general meeting as the case may require. and (b) with respect to transactions involving an aggregate payment or value equal to or greater than an agreed sum. where applicable. . whether directly or indirectly with any of the Interested Persons unless:(i) such transaction shall be on terms that are no less favourable to the Issuer than those which could have been obtained in a comparable transaction from persons who are not Interested Persons. The Issuer shall at all times keep proper books and accounts on a basis consistently applied in accordance with the laws of Malaysia and generally accepted accounting principles and standards in Malaysia. provided that the Issuer certifies to the Trustee that. the Issuer shall not enter into any transaction. shareholders at a general meeting. provided that the transaction has been approved by the majority of its board of directors and.

1. Messrs Adnan Sundra & Low has confirmed that it is not aware of any circumstances that would give rise to a conflict of interest or potential conflict of interest situation in its capacity as the solicitors in relation to the Senior Notes Issuance Programme. Lead Arranger and Facility Agent in respect of the Senior Notes Issuance Programme. As such. Notwithstanding the aforementioned. Adnan Sundra & Low acting as an external independent legal counsel for AmInvestment Bank. controls and checks with regard to transactions involving its related corporations. and AmInvestment Bank has in place its own internal policies. Lead Manager and Facility Agent in respect of the Senior Notes Issuance Programme is in the ordinary course of its business. Lead Arranger and Facility Agent for the Senior Notes Issuance Programme. The conduct of AmInvestment Bank is regulated strictly by BAFIA and CMSA. has been appointed to conduct a legal due diligence inquiry on AmBank. AmInvestment Bank. Lead Manager and Facility Agent. and Pacific Trustees Berhad has been appointed as trustee in respect of the Senior Notes Issuance Programme. AMFB and AmBank are deemed to be related corporations. The Board has confirmed that having considered the above situation. The potential conflict of interest may arise on the part of AmInvestment Bank in terms of duties owed to potential investors on the one hand and its relationship with AmBank on the other. in relation to all its appointed roles in respect of the Senior Notes Issuance Programme. has considered the factors involved and believes that objectivity and independence in carrying out its role has been/will be maintained at all times for the following reasons: AmInvestment Bank is a licensed investment bank and its appointment as the Principal Adviser. Messrs Adnan Sundra & Low After making enquiries as were reasonable in the circumstances. Lead Manager. -4- . and Save for the professional fees charged in relation to its role as the Principal Adviser. AmInvestment Bank will not be deriving any monetary benefit from the Senior Notes Issuance Programme outside of its aforesaid capacities. AmInvestment Bank. which in turn is a whollyowned subsidiary of AHB. AHB. they are agreeable to proceed with the appointment of AmInvestment Bank as the Principal Adviser. the following measures have been taken: the potential conflict of interest situation has been brought to the attention of the Board and hence the Board is fully aware of the same. AIGB. Lead Arranger.7 Conflict of Interest and Appropriate Mitigating Measures AmInvestment Bank Save as disclosed below. Lead Arranger. As mitigating measures and to address the potential conflict of interest set out above. AmInvestment Bank is a wholly-owned subsidiary of AIGB. AmInvestment Bank is not aware of any circumstances that would give rise to a conflict of interest in its capacity as the Principal Adviser. which in turn is a wholly-owned subsidiary of AHB. Messrs. AmBank is a wholly-owned subsidiary of AMFB. Lead Manager.

The rest of this page has been left blank intentionally - -5- . . Pacific Trustees Berhad has confirmed that it is not aware of any circumstances that would give rise to a conflict of interest or potential conflict of interest situation in its capacity as the trustee in relation to the Senior Notes Issuance Programme.Pacific Trustees Berhad After making enquiries as were reasonable in the circumstances.

only be applicable for this section. Jalan Raja Chulan 50200 Kuala Lumpur 8515-D nd (iii) Business Registration No. Non-Independent Non-Executive Director Independent Non-Executive Director Nationality Malaysian (viii) Board of Directors (as at 11 December 2009) Malaysian -6- . foreign exchange and (through its wholly-owned subsidiary. This shareholding structure is a reflection of AHB’s shareholding being a listed company. Date/Place of Incorporation Date of listing (in case of a public listed company) Status Resident/nonresident controlled company (where applicable) (iv) 25 March 1969 / Malaysia (v) Not listed on any exchange (vi) Resident controlled company.2. advances and financing. in the event of inconsistency with the definitions section of this IM. Issuer (i) (ii) Name Address AmBank (M) Berhad (“AmBank”) 22 Floor. Name of Directors Tan Sri Dato’ Azman Hashim (“TSDAH”) Tun Mohammed Hanif bin Omar Positions Chairman. AmIslamic Bank Berhad) Islamic banking services. deposit services. BACKGROUND INFORMATION 1. credit cards. remittance services. AmBank is deemed resident controlled company by virtue of AmBank’s Board of Directors and management composition. Note: Although foreign shareholders may hold equity in AMMB Holdings Berhad (“AHB”). Bangunan AmBank Group 55. Non-Bumiputera controlled company Bumiputera/nonBumiputera controlled company (where applicable) (vii) Principal Activities AmBank and its subsidiaries (“AmBank Group”) provide banking and financial services which include loans. SUMMARY OF THE PRINCIPAL TERMS AND CONDITIONS OF THE SENIOR NOTES ISSUANCE PROGRAMME Words and expressions used and defined in this section shall.

762^ / 100% 670. names of all substantial shareholders (as at 11 December 2009) AmBank is a wholly-owned subsidiary of AMFB Holdings Berhad (“AMFB”).363.000. in the case of public company.363. The substantial shareholders of AmBank as at 11 December 2009 are as follows: Name AMFB AHB TSDAH Amcorp Group Berhad Clear Goal Sdn Bhd ANZ Funds Pty Ltd Australia and New Zealand Banking Group Limited No. of AmBank shares / % Direct Indirect 670.000 6% irredeemable non-cumulative convertible preference shares of RM1.363.000 6% irredeemable noncumulative convertible preference shares of RM1.000 IPS -7- .00 each (“IPS”) Paid-up share capital 670.000.000.762*^ / 100% 670.363.363.762*^ / 100% 670.886.500.762#^ / 100% 670.00 each (“Ordinary Shares”). and (b) 2.762 Ordinary Shares and 150.363.250.250.762*^ / 100% 670.762*^ / 100% Notes: # Deemed interested by virtue of its interests in AMFB * Deemed interested by virtue of his/its interests in AMFB via his/its substantial interests in AHB ^ Excluding the 150.386.Tan Sri Datuk Clifford Francis Herbert Dato’ Gan Nyap Liou @ Gan Nyap Liow Tan Kheng Soon Cheah Tek Kuang Ashok Ramamurthy Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director Chief Executive Officer Non-Independent Non-Executive Director Malaysian Malaysian Malaysian Malaysian Australian (ix) Structure of shareholdings and names of shareholders or.00 each (x) Authorised and paid-up capital (as at 11 December 2009) Authorised share capital RM3.002 comprising:(a) 1.363.762*^ / 100% 670.363.002 ordinary shares of RM1. which in turn is a wholly-owned subsidiary of AHB.

(a) PRINCIPAL TERMS AND CONDITIONS Names of parties involved in the proposed transaction (i) Principal Adviser(s)/ Lead Arranger(s) Arranger(s) Valuer(s) Solicitors Financial Adviser Technical Adviser Guarantor Trustee Facility Agent Primary Subscriber(s) and Amount subscribed (where applicable) Underwriter(s) and amount underwritten Central Depository Paying Agent Reporting Accountant Others AmInvestment Bank Berhad (“AmInvestment Bank”) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) Not applicable Not applicable Adnan Sundra & Low Not applicable Not applicable Not applicable Pacific Trustees Berhad AmInvestment Bank To be determined prior to the issuance in respect of issuance on a bought-deal basis. Not applicable for issuance via book building or direct placement. The aggregate outstanding nominal value of the Senior Notes issued under the Senior Notes Issuance Programme at any point in time shall not exceed RM7. (c) Issue Size (RM) -8- . Up to RM7.0 billion in nominal value.2. (xi) Not applicable (xii) (xiii) (xiv) Bank Negara Malaysia (“BNM”) BNM Not applicable (xv) Lead Manager AmInvestment Bank Rating Agency RAM Rating Services Berhad (“RAM Ratings”) (b) Facility Description Senior notes (“Senior Notes”) to be issued pursuant to a senior notes issuance programme (“Senior Notes Issuance Programme”).0 billion.

Tenure of Senior Notes More than one (1) year and up to ten (10) years as the Issuer may select. Not applicable Final long-term rating of AA3 assigned by RAM Ratings. Tenure of Senior Notes Issuance Programme Up to thirty (30) years from the date of the first issuance under the Senior Notes Issuance Programme. (e) Tenor of the Facility/ Issue (f) Interest/Coupon (%) (please specify) rate The interest rates will be determined prior to each issuance. Denomination RM1. at a premium or at a discount at an issue price to be determined prior to issuance. The proceeds of the Senior Notes shall be utilised for the Issuer’s general working capital requirements and to defray issuance expenses for the establishment of the Senior Notes Issuance Programme. (l) (m) (n) Sinking fund (if any) Rating Form and Denomination -9- . (j) (k) Unsecured. provided that no interest period shall extend beyond the final maturity of the respective series.(d) Issue Price (RM) Issued at par. The date of the first issuance under the Senior Notes Issuance Programme shall not be later than twenty four (24) months from the date of approval by the Securities Commission (“SC”). Actual days/ 365 days (h) Interest/Coupon Payment Basis Yield to Maturity (“YTM”) (%) Security/Collateral Details on utilisation of proceeds (i) The YTM shall be determined prior to issuance. (g) Interest/Coupon Payment Frequency One (1). provided that the Senior Notes mature at or prior to the expiry of the Senior Notes Issuance Programme. three (3) or six (6) months at the option of the Issuer.000 (unless required to be in such other denominations in accordance with the Rules on Fully Automated System for Issuing/ Tendering (“FAST”) issued by BNM and/or any other relevant guidelines). No physical delivery of the Senior Notes is permitted. Form The Senior Notes shall be represented by Global Certificates in bearer form (exchangeable for definitive certificates in limited circumstances) in accordance with the Rules on the Scripless Securities under the Real Time Electronic Transfer of Funds and Securities (“RENTAS”) System and/or any other procedures/ guidelines issued by the relevant authority(ies). The Global Certificates will be deposited with BNM acting as the Central Depository.

direct placement or boughtdeal) and/or book building on a best effort basis without prospectus.10 - . 2007 (“CMSA”).e. no other regulatory approvals are required in relation to the issue. nor may any document or other material in connection therewith be distributed in Malaysia other than to persons falling within Schedule 6 or Section 229(1)(b) and Schedule 9 or Section 257(3) of the CMSA.(o) Mode of Issue The Senior Notes may be issued via private placement on a best effort basis (i. nor may any document or other material in connection therewith be distributed in Malaysia other than to persons falling within Schedule 6 or Section 229(1)(b) or Schedule 7 or Section 230(1)(b). sold or delivered.1(vi) in relation to “Covenants by the Borrower” as set out in the SC’s Guidelines on the Minimum Contents Requirements for Trust Deeds in respect of the Senior Notes Issuance Programme. directly or indirectly. After issuance The Senior Notes may not be offered. sold or delivered.1(iii) and 14. (t) Conditions Precedent The availability of the Senior Notes Issuance Programme shall be subject to conditions precedent. Issuance via bought-deal or direct placement 100% Issuance via book building 5% (r) Minimum Level of Subscription (RM or %) (s) Other regulatory approvals required in relation to the issue. Receipt of a report of the relevant winding-up search or the relevant statutory declaration in b) c) . amongst others. The SC’s approval on the waiver is sought concurrently with the SC’s approval for the Senior Notes Issuance Programme. At issuance The Senior Notes may not be offered. including but not limited to the following:a) Receipt of a certified true copy of the Issuer’s Memorandum and Articles of Association and board of directors’ resolution authorising. The SC will be notified accordingly in the event of such listing. offer or invitation and whether or not obtained The Senior Notes Issuance Programme is subject to the approval from the SC on the waiver from having to comply with paragraphs 14. and Schedule 9 or Section 257(3) of the Capital Markets and Services Act. Save for the above. Receipt of a list of the Issuer’s authorised signatories and their respective specimen signatures. (p) Selling Restriction (q) Listing Status The Senior Notes may be listed on Bursa Malaysia Securities Berhad under the Exempt Regime. directly or indirectly. offer or invitation of the Senior Notes under the Senior Notes Issuance Programme. the execution of the transaction documents.

d) e) f) g) relation thereto. The Issuer has the power to enter into. its creditors or any of its shareholders or any other person on its behalf nor have any legal proceedings or application been started or threatened under Section 176 of the Companies Act 1976. The Issuer’s entry into. legality and enforceability of the transaction documents and any other relevant documents pertaining to the Senior Notes Issuance Programme. which if adversely determined would have a material adverse effect on the ability of the Issuer to comply with its obligations under the transaction documents. exercise its rights under and perform its obligations under the transaction documents. in respect of the Senior Notes Issuance Programme and a written confirmation from the solicitors addressed to the Lead Arranger that the approvals are unconditional or. which shall include but not limited to the following:a) The Issuer is a company duly incorporated and validly existing under the laws of Malaysia and it has the power and authority to carry on its business and to own its properties and assets. to the best of the Issuer’s knowledge. where applicable. the conditions have been fulfilled (to the extent that they have to be fulfilled prior to the issuance of the Senior Notes). exercise of its rights under and performance of the transaction documents do not and will not violate any existing law or agreements to which it is a party. No step has been taken by the Issuer. The audited financial statements of the Issuer are prepared in accordance with generally accepted accounting principles and standards and they fairly represent its financial position. No litigation or arbitration is current or. (u) Representations and Warranties Representations and warranties typical and customary for a programme of this nature.11 - . All the transaction documents shall have been duly executed and endorsed as exempted from stamp duty. The Issuer shall have obtained the approvals from the SC. The transaction documents create valid and binding obligations which are enforceable on and against the Issuer. The Issuer shall have obtained a minimum longterm rating of AA3 from RAM Ratings at the point of first issuance. if they are conditional. and Satisfactory legal opinion from solicitors confirming (a) the validity. There has been no change in the business or condition (financial or otherwise) of the Issuer or its subsidiaries since the date of its last audited financial statements which might have a material b) c) d) e) f) g) h) . and (b) that all the conditions precedent have been fulfilled. is threatened.

the Issuer has not remedied the said breach within thirty (30) days after the Issuer became aware or having being notified of the failure.i) adverse effect on the ability of the Issuer to comply with its obligations under the transaction documents. is presented against the Issuer and the Issuer has not taken any action to set aside such petition within sixty (60) days from the date of service of b) c) d) e) f) . (v) Events of Default Standard events of default shall apply and shall include. the Trustee does not determine that such misrepresentation has been rectified to the Trustee’s satisfaction within thirty (30) days after the Issuer became aware or having being notified of the failure. Any indebtedness of the Issuer (other than indebtedness arising from the Senior Notes Issuance Programme) becomes due or capable of being declared due before its stated maturity or any guarantee or similar obligations of the Issuer is not discharged at maturity or when called and the occurrence of such event has a material adverse effect on the Issuer to meet its obligations under the Senior Notes Issuance Programme or the transaction documents. dissolution or liquidation of the Issuer or a petition for winding up. Any step is taken for the winding up. undertaking or covenant under the transaction documents (other than an obligation of the type referred to in (a) above) and in the case of a failure capable of remedy. if so payable. authorisation or approval that would materially impair or prejudice the Issuer’s ability to comply with the terms and conditions of the Senior Notes Issuance Programme and/or transaction documents and no appeal in respect thereof is made by the Issuer within the time period stipulated under the Banking and Financial Institutions Act 1989 (“BAFIA”) and/or any other relevant legislations. and Such other representations and warranties as may be advised by the solicitors for the Lead Arranger including but not limited to the requirements under the SC’s Minimum Contents Requirements for Trust Deeds.12 - . Any representation. save and except for such requirements waived by the SC pursuant to item (s) set out herein. but not be limited to: a) The Issuer fails to pay any amount due under the Senior Notes Issuance Programme and/or the transaction documents on the due date or on demand. warranty or statement which is made by the Issuer proves to be inaccurate in any material respect when made or repeated and in the case of a representation made in good faith but subsequently proves to be incorrect. withholding or modification of a licenses. There is a revocation. The Issuer fails to observe or perform or commits a breach of any obligation.

(where applicable) Other Principal Terms and Conditions for the issue Positive Covenants These shall include but not limited to the following: a) The Issuer shall at all times maintain its corporate legal existence and exercise reasonable diligence in carrying out its business in a proper and efficient manner and in particular.g) h) i) j) such winding up petition. sequestration or any form of execution is levied or enforced upon or instituted against any of the assets of the Issuer and is not discharged within sixty (60) days after being levied. suit or action. unless during or following such reconstruction. suit or action were instituted against the Issuer taken any reasonable steps to discharge or stay such legal proceedings. legal process. it shall ensure. consolidation or merger the Issuer becomes or is declared to be insolvent). amalgamation. and Such other Events of Default as may be advised by the solicitors for the Lead Arranger.13 - . Upon the occurrence of any of the above Events of Default. enforced or instituted. a moratorium on the payment of indebtedness or other suspension of payments generally (other than for the purposes of and followed by a scheme for reconstruction. or any security interest which may for the time being affect any of its assets becomes enforceable. receiver or similar officer is appointed in respect of. 1965 or there is declared by a Malaysian court or authority. if so directed by a special resolution of the holders of the Senior Notes. (w) Principal terms and conditions for warrants. The Issuer undergoes any scheme of reconstruction. declare that an Event of Default has occurred and the Senior Notes are immediately due and repayable. suit or action which could materially and adversely affect the obligations of the Issuer under the transaction documents or the Senior Notes Issuance Programme shall be instituted against the Issuer by any third party and the Issuer has not. An encumbrancer takes possession of. or a trustee. within thirty (30) days from the date such legal proceedings. arrangement or compromise pursuant to Section 176 of the Companies Act. the whole or substantial part of the business or assets of the Issuer or distress. Any legal proceedings. amalgamation. amongst Not applicable (x) (i) . consolidation or merger of the Issuer with prior approval in writing by the Minister of Finance or BNM. the Trustee may and shall.

(iv) any change in the utilisation of the proceeds from the Senior Notes Issuance Programme other than for the purpose stipulated. from the first issue date. that all necessary approvals or relevant licenses are obtained. and (vi) any other matters that may materially prejudice the interests of the holders of Senior Notes. reports.b) c) d) e) f) others. (v) any change in the Issuer’s withholding tax position or taxing jurisdiction. and (iii) such information relating to the Issuer’s affairs to the extent permitted by law which the Trustee may reasonably require from time to time in order to discharge its duties and obligations. a copy of its annual audited accounts and any other accounts. circulars or other documents issued by the Issuer to its shareholders. statements. (ii) any circumstance that has occurred or any other matter that may materially prejudice the ability of the Issuer to perform its obligations under the Senior Notes Issuance Programme. The Issuer shall at all times keep proper books and accounts on a basis consistently applied in accordance with the laws of Malaysia and generally accepted accounting principles and standards in Malaysia. (ii) annually. . notices.14 - . The Issuer shall at all times maintain a paying agent with a specified office in Malaysia. any Event of Default and if such is not the case. The Issuer shall provide the following to the Trustee: (i) within 180 days after the end of each financial year. The Issuer shall immediately notify the Trustee in the event that the Issuer becomes aware of the following: (i) the occurrence of any Event of Default and the Issuer shall take reasonable steps and/or such other steps as may be reasonably requested by the Trustee to remedy and/or mitigate the Event of Default. to specify the same. a certificate stating that the Issuer has complied with its obligations under the Trust Deed and the terms and conditions of the Senior Notes Issuance Programme and that there did not exist or had not existed. The Issuer shall at all times perform all its obligations and promptly comply with all provisions of the transaction documents and the terms and conditions of the Senior Notes Issuance Programme. (iii) any substantial change in the nature of the business of the Issuer.

The Issuer shall promptly comply with all applicable provisions of the CMSA and BAFIA and/or any notes.15 - . circulars. and Such other covenants as may be advised by the solicitors for the Lead Arranger including but not limited to the requirements under the SC’s Minimum Contents Requirements for Trust Deeds. where applicable. and (ii) with respect to transactions involving an aggregate payment or value equal to or greater than 25% of the Issuer’s total shareholders’ funds as reflected in the latest audited financial statements. Save and except for transactions lawfully entered into by the Issuer in the ordinary course of its banking and/or financial services business or such other incidental business(es) with its or its related corporations’ directors. the Issuer shall not enter into any transaction. the Issuer has received the certification referred to in this sub-paragraph (ii). the Issuer shall obtain certification from an independent adviser that the transaction is carried out on fair and reasonable terms. conditions and/or guidelines issued by the SC and BNM from time to time. whether directly or indirectly with any of the Interested Persons unless:(i) such transaction shall be on terms that are no less favourable to the Issuer than those which could have been obtained in a comparable transaction from persons who are not Interested Persons. and that the transaction has been approved by the majority of its board of directors and. shareholders at a general meeting. where applicable. provided that the transaction has been approved by the majority of its board of directors and. substantial shareholders or persons connected with any of them (“Interested Persons”) and recurring transactions with Interested Persons approved by the shareholders of the Issuer. provided that the Issuer certifies to the Trustee that. save and except for such requirements waived by the SC pursuant to item (s) set out herein.g) h) i) The Issuer shall procure that the paying agent notifies the Trustee in the event that the paying agent does not receive payment from the Issuer on the due dates as required under the Trust Deed and the terms and conditions of the Senior Notes Issuance Programme. (ii) Negative covenants These shall include but not limited to the following: a) The Issuer shall not carry out any business or other activities other than that currently set out in its Memorandum and Articles of Association. b) . where applicable. shareholders at a general meeting.

and Such other covenants as may be advised by the solicitors for the Lead Arranger including but not limited to the requirements under the SC’s Minimum Contents Requirements for Trust Deeds. liens or rights of set-off arising from the normal course of business. (iv) Redemption (v) Open Market Acquisition and Cancellation (vi) Changes of Circumstances If at any time prior to the availability of the Senior Notes Issuance Programme. Unless previously redeemed or purchased and cancelled. or Any of the Senior Notes acquired by the Issuer’s related corporations need not be cancelled but will not entitle such related corporations to vote at any meetings of the holders of the Senior Notes and will not be deemed to be outstanding for the purpose of determining the total votes exercisable by the holders of the Senior Notes whenever such determination is required under the Trust Deed. The Issuer shall not use the proceeds derived from the Senior Notes Issuance Programme for purposes other than those stated herein. save and except for such requirements waived by the SC pursuant to item (s) set out herein. void. unconditional. and will rank pari passu. without any preference amongst themselves.16 - . unsubordinated and unsecured obligations of the Issuer. request or requirement (whether or not having the force of law) will impose on the Financing Parties any condition. burden or obligation. and equally with all other present and future unsecured and unsubordinated obligations (excluding deposits) of the Issuer. voidable or unenforceable.c) d) e) The Issuer shall not execute or omit to execute any document which may render any of the transaction documents to be illegal. then the commitment of the Financing Parties to arrange/ subscribe (as the case may be) under the Senior Notes Issuance Programme will terminate upon notice to the Issuer of the occurrence of such event after becoming aware thereof. provided: (a) (b) Any of the Senior Notes so acquired by the Issuer shall be cancelled and cannot be reissued. The Issuer or any of its related corporations (within the meaning of the Companies Act 1965) may at any time acquire the Senior Notes at any price in the open market or by private treaty. as a result of any change in applicable law. the Senior Notes shall be fully redeemed on the respective maturity date(s) at 100% of their nominal value. except those obligations preferred by law. regulation or regulatory requirement or in the interpretation or application thereof or if compliance by the Lead Arranger / Facility Agent / Primary Subscriber(s) / investor(s) (collectively “the Financing Parties”) with any applicable direction. . (iii) Status The Senior Notes will constitute direct.

The laws of Malaysia The Issuer shall unconditionally and irrevocably submit to the exclusive jurisdiction of the courts of Malaysia. will materially affect the offering and distribution of the Senior Notes under the Senior Notes Issuance Programme in the secondary market upon successful completion of the arrangement of the same. the business activities or financial position of the Issuer which in the opinion of the Financing Parties. capital or syndicated loan markets.17 - . unless such withholding or deduction is required by law and the Issuer shall not gross up for any such withholding or deduction. All payments by the Issuer in respect of the Senior Notes Issuance Programme shall be made without withholding or deductions for or on account of any present or future tax. duty or charge of whatsoever nature imposed or levied by or on behalf of Malaysia or Malaysian law. In the event of overdue payment of any sums covenanted to be paid. The Senior Notes Issuance Programme shall be constituted by a trust deed. including but not limited to adversities in international/ domestic money. which shall be administered by the Trustee. (viii) Trust Deed (ix) Taxation (x) Interest on Late Payment(s) (xi) (xii) Currency Documentation (xiii) (xiv) Governing Law Jurisdiction . political or economic conditions.The rest of this page has been left blank intentionally - . Ringgit Malaysia Standard documentation satisfactory to all parties concerned incorporating clauses normal and customary for a financing of this nature and/or as advised by the Lead Arranger’s solicitors.(vii) Adverse Market At any time prior to the first issuance under the Senior Notes Issuance Programme. who shall act on behalf of the holders of the Senior Notes. the Issuer shall pay default interest of 1% above the prevailing Malayan Banking Berhad’s base lending rate on such overdue amounts. the Financing Parties reserve the right to withdraw/ terminate the arrangement of the Senior Notes Issuance Programme if there occurs any change in the national or international financial.

Under the “Deposit Insurance System”. significantly restrict business activities. the Malaysian Government moved to guarantee all bank deposits in an effort to shore up confidence in the Malaysian financial system. whether known or unknown. prospective investors should carefully consider. accounts held under joint ownership. BNM has on a case-by-case basis provided a safety net for individual banks with an isolated liquidity crisis. an independent statutory body.1. Effective from 1 September 2005. eligible deposits are insured up to a prescribed limit of RM60. BNM is given extensive powers to regulate the Malaysian banking industry under BAFIA. there can be no assurance that BNM will provide such assistance in the future. Those member companies are also subject to relevant securities and other laws in Malaysia.000 per depositor. per member institution for Islamic deposits (i. In the past.3. INVESTMENT CONSIDERATIONS The business of AmBank is subject to a number of risk factors. establish limits on lending to certain sectors of the Malaysian economy. Prior to making an investment decision. and establish measures requiring maintenance of reserves and minimum capital adequacy requirement. MDIC will monitor developments in the banking system and evaluate the need to increase the limit and the scope of coverage at that time. 3. the following risks. per member institution. There is also separate coverage of up to RM60. This includes the authority to limit the interest rates charged by banks on certain types of loans. Accordingly. may in the future have a material adverse effect on AmBank or the Senior Notes. Once the temporary Government guarantee expires on 31 December 2010.000 (inclusive of principal and interest) per depositor. financial condition or asset quality of banks and financial institutions in Malaysia.1 Considerations Relating to the Malaysian Banking Industry 3. those accepted under Shariah principles). . However. BNM announced the guarantee for all local and foreign currency deposits from 16 October 2008 until 31 December 2010. Generally. Additional risks. including those member companies of the AmBank Group which are financial institutions licensed under BAFIA and IBA. and all licensed commercial banks (including subsidiaries of foreign banks operating in Malaysia) and Islamic banks are member institutions of the Deposit Insurance System. many of which are outside their control. BNM has introduced a deposit insurance system. MDIC plans to revert to the explicit and limited coverage Deposit Insurance System. potential investors should be aware that BNM could. BNM is not required to act as lender of last resort to meet liquidity needs in the banking system generally or for specific institutions. The Deposit Insurance System is administrated by MDIC.2 Deposits in Malaysia On 16 October 2008. along with the other information in this IM.18 - . set interest rates at levels or restrict credit in a way which may be adverse to the operations. establish priority lending guidelines in furtherance of certain social and economic objectives. in the future. those member companies are regulated by BNM. BNM also has broad investigative and enforcement powers. particularly after several regional jurisdictions had done so to curb potentially damaging capital outflows. trust accounts and accounts in the name of sole proprietorships and partnerships.1.1 The AmBank Group may be subject to changes to the Malaysian regulatory environment for the financial industry To the extent that the member companies of the AmBank Group are financial institutions licensed under BAFIA. 3.e. The risks and risk factors set forth below are not an exhaustive list of the challenges currently facing AmBank or that may develop in the future.

and results of operations or prospects The Malaysian economy is affected by changes in the global economic and market environment. such as an unstable political system. Adverse changes to the conditions in the credit markets in the future may materially affect the value of AmBank's investment portfolio. in turn. . financial conditions and results of operations or prospects. In addition. Adverse political and economic conditions or developments. Whilst AmBank does not have any investments in any assets or securities linked to. financial condition. financial condition. AmBank may decrease its risk tolerance in its lending activities. which. results of operations or prospects. There can be no assurance that changes in market conditions will not adversely affect AmBank’s business. For example. or the value of which is derived from.However. Any widespread global financial instability may adversely affect the Malaysian economy. such investment securities may be adversely affected by future developments in the credit markets. 3. As a result of globalisation.19 - . If loans to these borrowers were to become nonperforming. the values of many of the investment securities that AmBank holds are sensitive to the volatility of the credit markets and accordingly. which could have the effect of reducing its interest margin and interest income. and ultimately the results of its operations. could have an adverse effect on AmBank’s business. or in investment securities comprising asset funds and trusts which hold and invest in assets that are classified as sub-prime residential mortgages or any direct or indirect exposure to the sub prime residential lending market in US or elsewhere arising from the global liquidity and credit crunch which has since shown signs of recovery.2 Changes in market conditions may have an adverse effect on AmBank's business. results of operations or prospects. This in turn may have a material adverse impact on the financial performance of the AmBank Group as a financial services provider. A continuation of these situations could adversely affect global economic conditions and world markets and. results of operations or prospects. which could materially and adversely affect AmBank’s business. this could adversely affect AmBank's business.2 Considerations Relating to the AmBank Group 3. ultimately resulting in adverse developments in national economic activity. to the extent that any of AmBank's borrowers have been adversely affected by the changes of market conditions and the global credit and financial markets generally. financial condition. the ability of such borrowers to service their debt obligations to AmBank may also be affected. economic or market problems in a single country or region are increasingly affecting other markets generally.2. create uncertainty and could discourage the free flow of investment capital and affect international trade. could cause a chain reaction effect and thus adversely affect the AmBank Group’s businesses. assets that could be classified as sub-prime residential mortgages. nationalisation and severe fluctuations in interest and currency exchange rates.1 Political and Economic Factors Political and economic conditions and developments in Malaysia as well as abroad could have a profound effect on the financial performance of the AmBank Group. if severe. the fact that deposits exceeding the prescribed limits are not insured up to their full amount could lead to or exacerbate liquidity problems.2. 3. or on the Malaysian financial markets generally. financial condition.

9% of the AmBank Group's loan portfolio. there can be no assurance that AmBank’s auto financing loan portfolio. financial condition. Although the AmBank Group would plan for expansion and growth in future business volume.3 Competition Whilst the number of domestic banking institutions has been reduced over time through consolidation. among other measures. The future growth of AmBank’s auto financing business depends on a number of factors. the banking industry has been given flexibility in setting lending rates. Although these policies are designed. Although BNM continues to influence interest rates. BNM has in 2009 announced further measures to liberalise the financial sector. in part. smaller market share and reduced income generally. to encourage development of financial institutions in Malaysia and to strengthen domestic financial institutions in preparation for increased foreign competition. AmBank also regularly enters into interest rate swaps for interest rate hedging purposes. BNM also announced that a new commercial bank license had been issued to a foreign institution under a bilateral arrangement between Malaysia and the People’s Republic of China. foreign licensed Islamic banks and domestic Islamic banks which are now allowed to offer/perform products and services that are similar to those of the AmBank Group. inter-alia.4 Interest rate changes AmBank’s exposure to interest rates arises mainly from its loan portfolio.2. periodically sells portions of its portfolio of housing loans and auto finance loans to Cagamas Berhad (the National Mortgage Corporation). However. To mitigate the risk of mismatch of interest rates on loans and deposits. holdings of securities and its interbank deposit/placement position. the actual effect on earnings due to a change in interest rates depends on the direction. There can however be no assurance that BNM will not impose increased or additional controls on interest rates which may have an adverse impact on AmBank’s business. whereby the loans are sold on a non-recourse basis to a special purpose vehicle. and results of operations or prospects. assets and liabilities and its ability to respond to changes in interest rates. including continued growth in the Malaysian economy supporting growth in automobile sales. Therefore. including a framework for the issuance of up to 5 new commercial banking licenses and 2 new Islamic banking licenses to foreign financial institutions and the increase of foreign equity limits to 70% in existing domestic Islamic banks. insurance and takaful companies. These measures will further intensify competition to the AmBank Group.20 - .2. there can be no assurance that the AmBank Group will be able to maintain or increase its present market share in the future.2.3. floating-rate loan products. As such. degree and timing of such change in interest rates. 3. which allows AmBank to compete more effectively in terms of pricing in its target business segments.5 A concentration in auto financing loans may adversely affect AmBank’s loan portfolio and its business. the behaviour and contractual repricing dates of AmBank’s funding operations. AmBank has introduced. On 20 November 2009. or its income from such . account for 41. the AmBank Group’s future growth would inevitably be subject to competition from other service providers and also customer preference. and undertakes asset securitisations. results of operations or prospects Auto financing loans have historically accounted for a significant portion of the AmBank Group's loan portfolio and as of 31 December 2009. financial condition. Further. the Malaysian banking industry operates in a very competitive environment fostered by BNM’s policies. 3. investment banks. any increased competition could have an adverse effect on the AmBank Group’s operations in the form of reduced margins.

financial condition. Any decline in the value of the collateral securing AmBank’s NPLs. AmBank is subject to business risks which are inherent in the financial services industry. fail to roll over deposited funds upon maturity.6 A decline in AmBank’s asset quality could adversely affect its business. the value of AmBank’s collateral securing NPLs declines or a material amount of AmBank’s loans becomes uncollectible. which may adversely affect AmBank’s business. results of operations or prospects if its loan provisions are insufficient to cover its liabilities AmBank’s business. or a small number of large depositors. results of operations or prospects. there is no assurance that the system will remain effective or adequate in the future.2. Funding risk.2. which is the risk of loss associated with changes in the value of portfolios and financial instruments caused by movements in market variables.loans. coupled with any inability to obtain additional collateral or inability to realise the value of collateral may require AmBank to increase its loan loss provisions. which may be more expensive than deposits. which do not maintain their value due to depreciation. results of operations or prospects could be adversely affected if AmBank’s loan provisions are insufficient. AmBank’s experience is that a substantial portion of its customers’ fixed deposits are rolled over upon maturity. these business risks can be broadly divided into: (a) Market risk.7 AmBank may experience liquidity problems as it is dependent on short-term funding The funding requirements of Malaysian banks are primarily met through short-term funding. 3. no assurance can be given that this will continue in the future. to finance its operations. AmBank’s NPLs position is more exposed than it otherwise would be to the inability of its customers to service their auto loans. commercial and corporate banking and treasury products and services. However. financial condition. because of the concentration of such loans. However. AmBank’s liquidity position could be adversely affected and AmBank may be required to seek alternative sources of short-term or long-term funding. foreign exchange rates and equity prices. such as interest rates. In addition. which is the risk of loss due to the inability or unwillingness of a (b) (c) . Credit risk.8 AmBank’s risk management system may be inadequate or ineffective in managing risks As a commercial banking institution covering activities including retail.2. 3. namely fixed-term deposits from customers and from other financial institutions. will continue to grow. which is the risk that AmBank is not able to fund its day-to-day operations at a reasonable cost. Generally. financial condition. and the occurrence of any of the economic risks discussed in this section may require AmBank to make additional loan loss provisions. 3. If a substantial number of depositors. there can be no guarantee that AmBank will be able to obtain such funds. financial condition. results of operations or prospects. In addition. AmBank has taken initiatives to accelerate tracking its month-in-arrears to be at or around key industry indicators. a portion of AmBank’s loans is also secured by collateral such as real estate and securities.21 - . Although AmBank believes that it has adopted a sound asset quality management and intends to maintain it. Furthermore. A portion of AmBank’s collateral is in the form of vehicles. Any significant decline in AmBank’s asset quality could adversely affect its business.

financial condition. or AmBank may find that it will not be able to enforce a counterparty obligation due to imperfect documentation. a market downturn may result in AmBank’s customers incurring losses thus weakening their financial condition and triggering an increase in credit risks.9 Major shareholders may influence policies of AmBank As of 31 December 2009. deficiencies in people and management or operational failure arising from external events. policies and procedures to control them to ensure sustainable risk-taking and sufficient return. of the issued share capital of AHB. AmBank’s financial position may be adversely affected resulting from any of the risks operating on its own. a 100% controlling interest in Amcorp. Far more critical to AmBank’s financial condition is a risk that has a ‘chain reaction’ effect whereby the operation of one risk leads to the operation of one or more other risks. holds 100% of the issued share capital of AmBank through AMFB. To counter the business risks it faces. The process to manage operational. and Legal and regulatory risk. up-to-date or properly evaluated. As of 31 December 2009. However. A description of AmBank’s risk management structure is set out in Section 6. the additional loss provisions (if large) may lead to AmBank breaching regulatory capital requirements. Such increased credit risks may require AmBank to set aside additional loss provisions which could potentially affect AmBank’s credit rating adversely thereby increasing liquidity risk.0 of this IM. Accordingly. which is the risk of potential loss from a breakdown in internal processes and systems. in turn. There can be no assurance that the corporate objectives and strategies of AmBank would not be substantially influenced by the policies of the shareholders. AmBank’s investment position in certain assets may require a huge mark-down as a result of the slump in the market price of those assets. AmBank has put in place a risk management framework to manage uncertainties such that deviations from AmBank’s intended objectives are kept within acceptable levels. each of these major shareholders may. breaches of obligations of fidelity. continuously measuring and monitoring the risks and to set limits. AHB and AmBank.72% and 23. complete. the Chairman/Non-Independent Non-Executive Director held indirectly. legal and regulatory risks would require proper recording and verification of a large number of transactions and events. TSDAH.counterparty to meet its payment obligations. The risk management framework thus serves to identify. In an extreme case. and inappropriate documentation of contractual obligations.2. the abovementioned risks. 3. Further. (d) Operational risk. the data relied upon to formulate the risk management framework may not be accurate. as a whole may not always be fully effective as there may be risks that have not been anticipated or identified and certain risks may be significantly greater than indicated by historical data. Amcorp and ANZ (via ANZ Funds) held 16. For example. inter-alia. For example. be able to exercise control over matters which require shareholders’ approval. Such process may not be fully effective in all cases. capture and analyse the risks assumed by AmBank at an early stage. In the case . the risk management framework.78%. any failure in the effectiveness of AmBank’s risk management procedures could have a material adverse effect on AmBank’s business. which is the risk of breaches of applicable laws and regulatory requirements. unenforceability of counterparty obligations. (e) Each of the business risks above has an implication on AmBank’s financial condition and every transaction that AmBank undertakes is subject to. which. results of operations or prospects.22 - . to a certain extent. respectively. Based on these shareholding interests in Amcorp.

3. cannot be entirely eliminated. Acts of misconduct by employees may take various forms and could include misappropriation of AmBank’s assets or the assets of its clients. (b) (c) . in extreme cases. and breach of client confidentiality. including directors.23 - . AmBank has in place internal control systems to check such misconduct and to take appropriate actions. Acts of misconduct by employees would not only result in financial loss to AmBank but may also tarnish its image. financial condition. regulations and guidelines.11 IT risk could affect AmBank’s business.of ANZ as major shareholder. including the following: (a) Adoption of an IT risk assessment and risk treatment model which is used to monitor and manage the critical information system operational risk. which would bring about a loss of its stature in the market. AmBank has continued to invest in human resource development to better equip its management team to keep abreast with current development of international market practices and to develop new skills required in meeting the demands of an increasingly dynamic and competitive market. there can be no assurance that AmBank would continue to benefit from this or any similar strategic relationship to the same extent. Formulation of an “Information and Communication Technology” plan which is reviewed annually to ensure continuous upgrading of the critical IT application systems. AmBank will endeavour to maintain its current prudent management philosophy and to continue to adhere to a high standard of corporate governance practices. Adoption of an IT governance model which includes regular reviews by senior management.2. AmBank's Board through various committees manages the business and affairs of the bank in a manner consistent with the objectives of good corporate governance and accountability towards the enhancement of shareholder value. results of operations or prospects AmBank is susceptible to IT risk as large portions of its operational systems are computerised. which. AmBank is committed towards business integrity and professionalism and firmly supports effective corporate governance and development of best practices. If for any reason the nature or extent of ANZ’s investment in AmBank were to change over time. the AmBank Group is susceptible to the risks associated with acts of misconduct by its employees including directors.10 Employee misconduct could adversely tarnish AmBank’s image and affect its business. could result in suspension and/or revocation of its banking and finance licences under BAFIA. 3. Whilst there is no assurance that there would be continuity in AmBank’s present management team throughout the tenure of the Senior Notes Issuance Programme. AmBank and such shareholder enjoy a strategic relationship which has been and is expected to continue to be of significant benefit to AmBank. results of operations or prospects As with any business enterprise. unauthorised transactions and/or commitment of its resources. concealment and/or wilful misstatement of its liabilities. acts of misconduct may also cover breaches of laws. AmBank has taken reasonable steps to reduce these risks. However. Whilst the risks of misconduct by employees. financial condition.2. Furthermore.

general provision and write-off policies. Storage management and backup services. 3. results of operations or prospects. . the first time adoption of FRS 139 by AmBank may result in adjustments to opening retained earnings and the potential recognition of fair value adjustments to the income statements. the application of fair value accounting and impairment assessment for financial assets and financial liabilities. or for a substantial consideration. FRS 139 requires. Therefore. (e) AmBank has also recently obtained ISO27001 certification for two (2) data centres and the following IT services provided to support the data centres: IT risk and information security services. Although AmBank believes that its loan portfolio is adequately provided. Database administration services. financial condition and results of operations of AmBank. FRS 139 will be applicable for the first time with effect from the financial year beginning 1 April 2010. provision for bad and doubtful debts.13 Risk of possible future mergers and acquisitions within the banking industry Given the consolidation of financial institutions in the domestic banking industry. which could have an adverse effect on the business.2. there can be no assurance that the AHB Group will not be affected by or involved in any mergers or acquisitions in the future and that any such mergers or acquisitions will be guaranteed a successful implementation or will not have any adverse effect on the AHB Group’s business. if the AHB Group makes a decision relating to any acquisition or merger in uncertain or highly competitive economic or market conditions. 3. and Conduct of regular audits to ensure that appropriate mechanisms are in place and are being adopted for IT security and control.12 Classification and Provisioning Policies for NPLs AmBank adopts conservative accounting policies vis-à-vis BNM’s requirements with regard to classification of NPLs. financial condition. and Data centre management services.Financial Instruments: Recognition and Measurement will be applicable to all entities for annual periods beginning on or after 1 January 2010. In particular. the financial impact of adopting FRS 139 could not be reliably estimated yet. the Malaysian Accounting Standards Board (MASB) had announced that Financial Reporting Standard (FRS) 139 . such an acquisition or a merger may result in an increase to its risk factor or a depletion of the resources of the AHB Group. respectively.(d) Formulation and adoption of disaster recovery procedures and facilities for critical application areas which are tested on a regular basis. As a result.2. For AmBank.24 - . Currently. Network administration services. System administration services. Further. no assurance can be given that the level of provisions would prove to be adequately provided for or that AmBank would not have to make significant additional provisions for possible loan losses in the future. among others. AmBank is still in the process of preparing to make changes to systems and processes in readiness for compliance with FRS 139.

although believed to be reasonable.3. liquidity. are subject to risks and uncertainties which may cause actual events and the future results of the AmBank Group to be materially different from that expected or indicated by such statements and estimates and no assurance can be given that any such statements or estimates will be realised. Any downgrade or withdrawal of a rating may have an adverse effect on the liquidity and market price of the Senior Notes but would not constitute an event of default or an event obliging the Issuer to prepay the Senior Notes. the inclusion of forward-looking statements in this IM should not be regarded as a representation or warranty by the AmBank Group or any other person that the plans and objectives of the AmBank Group will be achieved.3 Considerations Relating to the Senior Notes 3. No assurance can be given as to whether an active or liquid trading market for the Senior Notes will develop or if a trading market develops. among others.3.2 A downgrade in ratings may affect the liquidity and market price of the Senior Notes The Senior Notes are rated AA3 by RAM Ratings. The ability of its principal subsidiaries and its other subsidiaries to pay dividends is dependent on them maintaining profitable operations and is subject to applicable laws. regulatory guidelines and restrictions on the payment of dividends by any of the regulatory authorities or by restrictions contained in relevant financial or other agreements. future operations. 3.4 Issuer’s ability to meet its obligations under the Senior Notes The Senior Notes constitute direct and unsecured obligations of the Issuer and are payable out of the business operations of the Issuer and thus will not be the obligations or responsibilities of any person other than the Issuer.3.3. There can be no assurance that the rating will remain in effect for any given period or that the ratings will not be revised by the rating agencies in the future if. In light of these and other uncertainties. Furthermore. 3.3 There are no terms in the Senior Notes that limit the Issuer’s ability to incur additional indebtedness. capital resources and financial position. 3. The issue of such securities and/or incurrence of such indebtedness may reduce the amount recoverable by the holders of the Senior Notes in the event of dissolution or windingup of AmBank. no assurance can be given as to the market prices for the Senior Notes.1 Liquidity of the Senior Notes The Senior Notes will constitute a new issue of securities with no established trading market. These statements include. All forward-looking statements are based on estimates and assumptions made by the AmBank Group and third party consultants that. that it will provide investors with liquidity of investments or that the liquidity will continue for the tenor of the Senior Notes Issuance Programme. 3.4 Forward Looking Statements Certain statements in this IM are forward-looking in nature. in their judgement. discussions of the AmBank Group’s business strategies and expectations concerning its position in the Malaysian economy. The creation and issue of further securities or any other form of indebtedness that are secured or which rank pari passu with the Senior Notes shall not require the consent of the holders of the Senior Notes. including but not limited to any indebtedness that are secured or ranks equally with the Senior Notes There are no restrictions on the amount or number of other securities or any other form of indebtedness that AmBank may issue which are secured or ranks pari passu with the Senior Notes. The ability of the Issuer to meet its obligations to pay the nominal value of the Senior Notes and their interest will largely be dependent on the revenue generated by its operations and the receipts of dividends from its principal subsidiaries and its other subsidiaries. . profitability.25 - . circumstances so warrant.3.

250. sales and financial services personnel and agents. credit cards. AmBank is the fifth largest domestic bank in Malaysia (based on the published financial results of the nine domestic banks in Malaysia) as at 30 September 2009.002 comprising 1. deposit services. credit cards receivables and loans for personal use) by value in Malaysia (based on the published financial results of the nine domestic banks in Malaysia) as at 30 September 2009. foreign exchange and (through its wholly-owned subsidiary. AmBank’s principal retail banking activities are the provision of consumer loans such as auto financing.97 billion. On 20 December 2001. 4. Currently. Pursuant to a restructuring scheme. investment banking and treasury services to its clients.20 billion. AmBank is engaged in a wide range of retail.57 billion.363.000 IPS respectively are issued and fully paid-up. as further described in Section 4. AmBank has the fourth largest retail assets (defined as loans to individuals for purchase of transport vehicles.002 Shares and 2. AmIslamic Bank Berhad) Islamic banking services.886. 4.33 billion and shareholders’ funds of RM5.26 - . advances and financing. In terms of total assets. MBf Capital was listed on the Main Board of Bursa Securities in place of MBf Finance effective from 15 January 1993 and consequently. AmBank's corporate and investment banking business is to provide treasury and lending services to its large corporate and institutional clients.250. The focus of AmBank’s business banking activities is commercial lending and trade finance.762 Shares and 150. mortgages and personal financing/co-operative loans small business and asset financing and credit cards.000. Following the Business Transfer.500.4. in particular. purchase of residential properties.386. MBFC was listed on the Main Board of the stock exchange now known as Bursa Malaysia Securities Berhad on 8 June 1983 and changed its name to MBf Finance Berhad (“MBf Finance”) on 19 December 1985. In total the AHB Group has over 7.000. Arab-Malaysian Finance Berhad (now known as AMFB Holdings Berhad and a wholly-owned subsidiary of AMMB Holdings Berhad (“AHB”)) acquired 100% of MBf Finance. remittance services. AmBank’s distribution network comprises 189 branches (including 2 dedicated Islamic banking branches). advances and financing of RM63. 745 ATMs and 129 self-service EBCs in Malaysia. business and Islamic banking activities.2 Business Overview As at 31 December 2009. . AmBank is a licensed bank and finance company under BAFIA and it provides banking and financial services which include loans. for mid-sized corporations and SMEs in Malaysia. under the name of Malaysia Borneo Finance Corporation (M) Berhad (“MBFC”).1 DESCRIPTION OF THE ISSUER History and Background Information on AmBank AmBank was incorporated in Malaysia under the Act on 25 March 1969 as a public limited company. MBf Finance became a wholly-owned subsidiary of MBf Capital Berhad (“MBf Capital”).3 of this IM. customer deposits of RM67. with MBf Capital assuming the listing status of MBf Finance.000 IPS of which 670. loans. MBf Finance was delisted. AmBank has unaudited consolidated total assets of RM88. As at 11 December 2009. AmBank also leverages on the sales agents in the AHB Group. AmBank (M) Berhad on 1 June 2005. marketing. AmBank has expanded its corporate. MBf Finance then changed its name to AmFinance Berhad before assuming its present name. the authorised share capital of AmBank is RM3. Besides its network of dedicated nationwide marketing officers and personal bankers.000 personal bankers.

000. Corporate and Institutional Banking.300.05 per share which were convertible into 163.915. (b) ANZ Funds also acquired 300. This is crucial following the completion of the framework for investment banking whereby the BNM introduced more stringent limits on lending. Business Banking.000 shares were fully allocated to eligible Bumiputera shareholders. through its whollyowned subsidiary AMFB.934.0 million exchangeable bonds by AmBank to ANZ Funds which were originally exchangeable into 188.915.3 Group Internal Reorganisation The integration of the fund-based business activities of AmInvestment Bank and AmBank (“Business Transfer”) was completed on 12 April 2008.884.27 - .917.184. Current senior management nominees by ANZ include the Deputy Group Managing . ANZ Funds’ shareholding has been diluted to 23. This has enabled AmInvestment Bank to leverage AmBank's balance sheet to provide for larger and more structured investment banking deal flow. On 3 August 2009. all of which have since been converted into shares in AHB by ANZ Funds in March 2008. 4. AHB has allotted 194.0% of the share capital of AmBank. The paid-up capital of AHB has increased from RM2.014. Subsequently.78% currently.844 upon the exchange. and the issuance of RM575. subsequent to a rights issue exercise undertaken by AHB to partially fund the privatisation of AIGB.17% to 24.934.426 new shares in AHB.722.991. on 25 August 2009. AHB announced the completion of its Special Issue Share exercise where 96.254 shares in AHB and the exchange price was reduced to RM2.4 Australia and New Zealand Banking Group Limited (“ANZ”) On 26 April 2007.969. General Insurance. AHB controls 100. ANZ Funds’ shareholding increased from 19.000 shares in AHB in May 2007 pursuant to a purchase from Amcorp and 57.254 new AHB shares to ANZ Funds upon the latter’s notice to exchange its entire holding of the exchangeable bonds into new AHB shares. all of which have since been exchanged into shares in AHB by ANZ Funds in August 2009.426 convertible preference shares by AHB to ANZ Funds at an issue price of RM3.The AHB Group was the fifth largest financial services group in Malaysia in terms of total assets based on the published financial results of both domestic and foreign financial services groups in Malaysia as at 30 September 2009. ANZ's equity participation entailed: (a) the issuance of 163. AHB’s current paid-up share capital is RM3.524. Investment Banking. The AHB Group’s business operations include Retail Banking. the outstanding bonds were exchangeable for 194.05 per share. Islamic Banking and other related financial services.590 new shares in AHB at RM3. Treasury and Markets. underwriting of both debt instruments and equities as well as proprietary trading by investment banks. ANZ’s equity investment provides ANZ with the opportunity to nominate senior management appointments to the AHB Group.803 shares in AHB in January 2008 pursuant to ANZ Funds’ entitlement under the said rights issue exercise undertaken by AHB. the universal banking platform is in line with global trends and international market practices as it is now widely implemented by major banking groups. in the AHB Group. In addition. 4. Life Insurance.95 per share in AHB. ANZ has three representatives on the board of directors of AHB along with representations on the various Management and Board Committees of AmBank. AHB obtained the approval of its shareholders at an EGM for its proposed strategic partnership with ANZ by way of ANZ's equity participation via ANZ Funds.844.57% upon the exchange.590 as at 31 July 2009 to RM2.

corporate and institutional bank in Australia and one of the largest banks in New Zealand. with its primary operations in Australia. March 2009 – ANZ was awarded “Best Retail Bank in Australia” and “Best Retail Bank in Vietnam” in the Excellence in Retail Financial Services Award Financial Insight Innovation Award. ANZ is an international banking and financial services group which is ranked amongst the top 50 banks in the world by market capitalisation. ANZ has established partnerships with the following financial institutions in Asia: Metrobank Card Corporation (Philippines). Saigon Securities Inc (Vietnam). In 2009. 1 bank globally on corporate sustainability performance for the third consecutive year Canstar CANNEX. Sacombank (Vietnam). ANZ’s securities are listed on the Australia. banking systems as well as cross border capabilities in Asia.Director/ Group Chief Financial Officer. ANZ announced it had reached agreement with the Royal Bank of Scotland Group plc (“RBS”) to acquire selected RBS businesses in Asia delivering on its strategy to be a leading super regional bank by 2012. the recognition and awards which ANZ received included: Dow Jones Sustainability Indexes. Indonesia and Hong Kong. June 2009 – ANZ was named the “Socially Responsible Bank of the Year” The Asian Banker. given ANZ's exposure to international products. New Zealand and Asia Pacific. training and development of personnel.The rest of this page has been left blank intentionally - . Singapore. Bank of Tianjin (China) and the Shanghai Rural Commercial Bank (China). . the Philippines and Vietnam. Group Chief Risk Officer and Group Chief Operations Officer. product innovation. ANZ has over six million customers worldwide and a presence in over 30 countries. IT infrastructure. retail banking and business banking. The acquisition includes the RBS retail. Its retail business in Australia provides a full range of products through over 820 branches. wealth and commercial businesses in Taiwan. Panin Bank (Indonesia). February 2009 – ANZ was awarded “Syndication Loans House of the Year” and “Trade Finance House of the Year” in the Insto Distinction Award. September 2009 – ANZ ranked as the No. March 2009 – ANZ MoneyManager was awarded for Innovation in Account Aggregation Insto Magazine. ANZ is a leading retail. branding.28 - . The AHB Group's strategic partnership with ANZ has created further market growth opportunities. Vientiane Commercial Bank (Laos). New Zealand and New York Stock Exchanges. and the institutional businesses in Taiwan. By leveraging on ANZ's capabilities in risk management. On 4 August 2009. ANZ Royal (Cambodia). AmBank aims to entrench its position as a premier financial institution providing innovative products and services to its customers.

000 3.06.000 3.00 1.00 1.400.300.250.00 1.1972 10.03.000 820.00 Total (RM) 3.04.00 1.5.01.400.000 50.363.000.363.900.00 1.IPS Issued and fully paid-up .000.000.000 540.002 2. Jalan Yap Kwan Seng.000 2.1970 25.000.250.00 1.675.950.002 1.000 Subscribers’ shares Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Cash Rights issue of 3 for 2 at RM1.1972 02.00 1.000 5.386.000 Par value (RM) 1.00 1.000 400.002 2.000.00 1.5.000 4.00 1.00 1.000 820.000 6.762 670.1980 No.1972 17.000 3.300. 8.325.29 - .000 3. 50450 Kuala Lumpur and Menara Dion.000 500.500.000.00 Type of issuance Cumulative share capital (RM) 2 1.002 1.250.000.00 1.00 1.500.00 1.000 50.00 1. No.03.03.000 17.500.762 670.762 150.01.000 The changes in the issued and paid-up share capital of AmBank since its incorporation are as follows: Shares Date of Allotment 25.03.04.1974 23. of shares Par value (RM) 1.386.00 1.000 100.00 1.000 250.1971 29.000 2.000.02.1969 03.00 per share Special issue to Bumiputera investors at RM1.03.000 400.1970 31.1969 24.000 2.00 1.540.000.325.000 4.00 1.1972 16.4.886.000 1.000 2.03.1972 13.000 50.02.00 1.1971 28.5 Corporate Information 4.11. Bangunan AmBank Group.000 500.000 1.000 1.10 per share .00 1.200.1974 29.000 220.000 5.000 11.06.250.11.000 3.00 1.000.000 nd Authorised .11.09.000 2. 55 Jalan Raja Chulan.1969 11.620.000 15. Jalan Sultan Ismail.000 50.1969 11.00 1.09.1971 28. 4.000 100.03.000.00 per share Rights issue of 3 for 2 at RM1.500.000.300.000 2.Shares . 50200 Kuala Lumpur while the principal place of business of its Retail and Business Banking Divisions are located at Menara AmBank.000 100.762 150.03.Shares .050.1972 27. of Shares allotted 2 999.12.00 1.363. 50250 Kuala Lumpur respectively.00 1.1973 18.1976 17.06.650.000 2.000 1.998 200.000 460.1976 09.IPS 3.2 Share Capital and Changes in Share Capital Share Capital The authorised and issued and fully paid-up share capital of AmBank as at 11 December 2009 are as follows: Type No. No.1974 04.00 1.100.00 1.000 1.1971 23.886.000 30.363.1 Principal Place of Business The registered office of AmBank is located at 22 Floor.

744.50 0.000 29.750.1983 18.000 724.00 to RM0.000 110.50 on 22 December 1981.05.Date of Allotment 02.50 1.30 per share Rights issue of 1 for 2 at RM0.000 2 0.363. 2 The shares were cancelled on 16 December 1992 pursuant to a scheme of arrangement under Section 176 of the Act between MBf Finance and its shareholders sanctioned by the High Court of Malaya on 17 September 1992 under Originating Petition No.000 110.000 1.000 Par value (RM) 1.50 0.402.334 60.500.1996 23.50 0.000 663.642 new Shares allotted to AMFB pursuant to the acquisition of all issued shares in AmIslamic Bank.000 58.1989 22.136.613.428 610.05.00 each in MBf Capital. IPS Date of Allotment 18.1991 31.08.375.07.50 per share Cash Cash Allotment of Preference Shares Capital reduction Consolidation 4 6 6 7 663.000 2 3 2 528.750.000.06.227.50 1 Type of issuance Cumulative share capital (RM) 24.50 each on 23 January 2002.000 73.000 67.12.000.50 per share Rights issue of 1 for 2 at RM1.2002 12.10.000 .013. 4 Settlement for part of the consideration due in respect of the transfer of business from AMFB pursuant to the vesting order of the High Court of Malaya under Section 50 of BAFIA.05.220.363.625.11.000.816. D6-26-2792 and re-allotted to MBf Capital on the same date.625.00 0.50 1 0.50 1 0.000 1.50 1 0.875.750.961.50 0.875.500 221.00 per share Bonus issue of 7 for 5 at RM0.12.000 221.06. 7 Conversion of RM300.06.06.000.12.2005 20.120 593.1997 29.920.227.1984 21.128. 5 Preference shares which were subsequently converted to ordinary shares of RM0.750.1981 14.2008 663.90 per share Shares allotted to MBf Capital pursuant to a scheme of arrangement Bonus issue of 1 for 1 at RM0.402.250.2002 31.1992 No.50 0. 3 Pursuant to an order by the High Court of Malaya dated 22 April 2002 for capital reduction and consolidation in accordance with Section 64(2) of the Act.000.476. every one (1) ordinary share of RM0.825.000 700.000 0.2007 Cumulative share capital (RM) No.000 110.1999 29.1999 12.250.20 per share Bonus issue of 1 for 3 at RM0.00 1 1 Rights issue of 2 for 5 at RM1.30 - .00 1.000.50 each in MBf Finance was exchanged for one (1) new ordinary share of RM1.118 64.06.50 per share Cash Rights issue of 1 for 4 at RM1.750.000.000 59.11.625.000 5 2.000 331.000 Type of issuance Allotment of Preference Shares 150.937.00 1.000 nominal amount of Interest Bearing Irredeemable Convertible Unsecured Loan Stock due 2017 (“ICULS”) at the conversion price of RM5. of Shares allotted 6.50 1 0.00 1.00 1.1990 29.00 nominal amount of ICULS for every one (1) Share.499.000 1.000 165.000 73.07.000 2.750.000 (5.2002 18.000.762 670.762 3 Notes: 1 The par value of the shares was subdivided from RM1.000 331.1991 16.2005 29.03.05.50 per share Rights issue of 2 for 3 at RM0.996) 0 528. of IPS allotted 150. 6 81.07.750.50 1 1 1 1 1 1 16.50 0. Pursuant to the said scheme.1983 09.750.308 17.

762 1.3 2.3 Deemed interested by virtue of its interest in AMFB Deemed interested by virtue of his/its interests in AMFB via his/its substantial interests in AHB Excluding 150. Malaysia Labuan.3 2. of Shares % Indirect interest 100 670.3 2.31 - .363.363.762 670.000 IPS 4.363. Malaysia Malaysia Malaysia Malaysia Effective Equity Interest (%) 100 100 100 100 100 100 100 Principal Activities AmIslamic Bank AmTrade Services Limited AMBB Capital (L) Ltd AmCapital (L) Inc AmProperty Holdings Sdn Bhd Bougainvillaea Development Sdn Bhd MBf Information Services Sdn Bhd MBf Trustees Berhad MBf Nominees (Tempatan) Sdn Bhd MBf Equity Partners Sdn Bhd * Natprop Sdn Bhd Teras Oak Pembangunan Sendirian Berhad Komuda Credit & Leasing Sdn Bhd Everflow Credit & Leasing Corporation Sdn Bhd AmCredit & Leasing Sdn Bhd Li & Ho Sdn Berhad * Annling Sdn Bhd * Islamic banking Trade finance services Special purpose vehicle Special purpose vehicle Property investment Property investment Rental of computer equipment and the provision of related support services Trustee services Nominee services Dormant Dormant Dormant Dormant Dormant Dormant Dormant Dormant Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia 60 100 100 100 100 100 100 100 100 100 .3 Substantial Shareholders Based on the Register of Substantial Shareholders.4.762 670.762 670.5.000.762 3 No.363.363.762 670.363.363.6 Subsidiaries of AmBank The following are the subsidiaries of AmBank as at 11 December 2009: Name of Company Country of Incorporation Malaysia Hong Kong Labuan. the substantial shareholders of AmBank as at 11 December 2009 and their shareholdings in AmBank are as follows: Substantial Shareholders AMFB AHB TSDAH Amcorp CGSB ANZ Funds ANZ Notes: 1 2 3 Nationality/ Country of Incorporation Malaysia Malaysia Malaysian Malaysia Malaysia Australia Australia Direct interest 670.3 % 100 100 100 100 100 100 - 2.3 2.762 670.

On 1 May 2006. AMBB adopted its current name. and AMBB ceased its operation.7 Principal Subsidiary of AmBank AmIslamic Bank AmIslamic Bank was incorporated in Malaysia as a public limited company on 14 April 1994 under the Act originally under the name of Arab-Malaysian Bank Berhad (“AMBB”).32 - . AMBB was incorporated to acquire the commercial banking business of the Malaysian branch of Bank of America Asia Limited which was completed on 1 August 1994. in line with the initiative announced by BNM on the merger of the commercial banking and finance company businesses in a banking group into a single entity. AmFinance Berhad adopted its present name. With the merger. a licensed finance company subsidiary of AHB.Name of Company Country of Incorporation Malaysia Malaysia Malaysia Malaysia Malaysia Labuan.The rest of this page has been left blank intentionally - . and commenced operations as an Islamic bank under the IBA after AmBank transferred all of its Islamic banking business to AmIslamic Bank. the banking business of AMBB was transferred to AmFinance Berhad. AmBank. AmIslamic Bank. . AmIslamic Bank provides a complete range of Islamic commercial banking products and services in accordance with Shariah principles. It is a 100% owned subsidiary of AmBank and its ultimate holding company is AHB. save and except for MBf Equity Partners Sdn Bhd which shall take effect from 31 March 2010. On 1 June 2005. Malaysia Malaysia Malaysia MBf Nominees (Asing) Sdn Bhd * Malco Properties Sdn Bhd Lekir Development Sdn Bhd * Crystal Land Sdn Bhd * Economical Enterprises Sendirian Berhad AmInternational (L) Ltd AmPremier Capital Berhad AmMortgage One Berhad Effective Equity Interest (%) 100 81.51 100 97.87 100 100 100 100 Principal Activities Dormant Dormant Dormant Dormant Dormant Offshore banking Special purpose vehicle Special purpose vehicle Note: * These subsidiaries had applied to the Companies Commission of Malaysia (“CCM”) for striking off their names from the Register of CCM and had on 22 January 2010 received notification from CCM that the dissolution pursuant to Section 308 of the Act will take effect from 21 March 2010. 4.

10.12.12.000 IPS . Non-Independent Executive Director) 100 Tun Mohammed Hanif bin Omar (Independent Non-Executive Director) Tan Sri Datuk Clifford Francis Herbert (Independent Non-Executive Director) Dato’ Gan Nyap Liou @ Gan Nyap Liow (Independent Non-Executive Director) Tan Kheng Soon (Independent Non-Executive Director) Cheah Tek Kuang (Chief Executive Officer) Ashok Ramamurthy (Non-Independent Director) - - - - - - - - - - - - - - - - - - - - Non-Executive - - - Notes: 1 Deemed interested by virtue of his interests in AMFB via his substantial interests in AHB 2 Excluding 150.4.8. of Shares held as at 11 December 2009 Direct % Indirect % Non670.363.2005 Malaysian 20.2 Directors’ Shareholdings Name (Designation) No.2001 Malaysian 20.06.000.12.2006 Malaysian 01.11.2001 Malaysian 18.2008 Australian 4.8.10.1 Board The members of the Board as at 11 December 2009 are as follows: Name / Designation Date of appointment Nationality TSDAH (Chairman.33 - .2001 Malaysian 01.8 Information on Directors and Senior Management 4.762 1.2 TSDAH (Chairman.2005 Malaysian 15. Non-Independent NonExecutive Director) Tun Mohammed Hanif bin Omar (Independent Non-Executive Director) Tan Sri Datuk Clifford Francis Herbert (Independent Non-Executive Director) Dato’ Gan Nyap Liou @ Gan Nyap Liow (Independent Non-Executive Director) Tan Kheng Soon (Independent Non-Executive Director) Cheah Tek Kuang (Chief Executive Officer) Ashok Ramamurthy (Non-Independent Non-Executive Director) 20.

ECM Libra Foundation and Perdana Leadership Foundation. AmIslamic Bank.34 - . AmProperty Trust Management Berhad. a Fellow of the Institute of Chartered Accountants and a Fellow of the Institute of Chartered Secretaries and Administrators. Malaysia-Australia Foundation. Bhg. MalaysiaJapan Economic Association. He is President of the Malaysia South-South Association. the Malaysia Productivity Corporation and Chairman Emeritus of the Pacific Basin Economic Council (PBEC) International and Co-Chairman of Malaysia – Singapore Roundtable. Governing Body of the Asian Productivity Organisation and International Advisory Panel. He is the Non-Independent Non-Executive Chairman of AHB. He is also the Leader of the ASEAN-Japanese Business Meeting (Malaysia Committee. Open University of Malaysia and Member. has been in the banking industry since 1960 when he joined BNM and served there until 1964. Yayasan Canselor Open University Malaysia and Yayasan Wakaf Malaysia. TSDAH is the Chairman of the Malaysian Investment Banking Association. TSDAH is also involved in several charitable organisations as Chairman of AmGroup Foundation. namely AIGB. He practised as a Chartered Accountant in Azman Wong Salleh and Co. East-Asia Business Council. a Malaysian. a subsidiary of Malayan Banking Berhad. AMFB. Yayasan Tuanku Najihah. The Trilateral Commission (Asia-Pacific Group). was appointed to the Board on 20 December 2001. MCM Technologies Berhad. He serves as a member on the board of directors of Pembangunan MasMelayu Berhad and has recently been appointed as a director of Asian Institute of Finance Berhad (formerly known as Financial Services Education Centre Berhad). He was the Executive Chairman of Kwong Yik Bank Berhad. from 1980 until April 1982 when he acquired the then Arab-Malaysian Development Bank Berhad which is now known as AmInvestment Bank. BNM International Centre for Education in Islamic Finance (INCEIF). TSDAH has been the Chairman of AHB. Yayasan Azman Hashim. and trustee for Yayasan Perpaduan Nasional. the Malaysian-British and Malaysia-China Business Councils. TSDAH also sits as Chairman of the board of directors of several subsidiaries of AHB. and Chairman of Malaysian South-South Corporation Berhad. Malaysian Liver Foundation. AmInvestment Bank. Institute of Bankers Malaysia and the Islamic Banking and Finance Institute Malaysia Sdn Bhd.4. . AmLife and AmG Insurance Berhad.3 Directors’ Profiles Y. a Chartered Accountant (FCPA). Tan Sri Dato’ Azman Hashim TSDAH. He is the Pro-Chancellor. and the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) Business Advisory Council. AIM Centre for Corporate Social Responsibility. Malaysian Prison FRIENDS Club and Non-Aligned Movement’s (NAM) Business Council and Treasurer. Keizai Doyukai) and is on the board of Advisors. He is a Member of the APEC Business Advisory Council. TSDAH. from 1964 to 1971. TSDAH is the Executive Chairman of Amcorp and RCE Capital Berhad. since 1991.8.The rest of this page has been left blank intentionally - . the holding company of AmBank. He then joined the board of directors of Malayan Banking Berhad from 1966 until 1980 and was its Executive Director from 1971 until 1980.

a Malaysian. Tan Sri Datuk Clifford was Chairman of KL International Airport Berhad which built the Kuala Lumpur International Airport. Tan Sri Datuk Clifford at present sits on the respective board or directors of Genting Malaysia Berhad (formerly known as Resorts World Bhd). Tun Mohammed Hanif is also currently the Chairman of General Corporation Berhad. he was also appointed as alternate Governor of the World Bank. Petroliam Nasional Berhad. he served in the Ministry of Finance from 1975 to 1997. Tun Mohammed Hanif bin Omar Tun Mohammed Hanif bin Omar. was appointed to the Board on 20 December 2001. a Malaysian. As Secretary General in the Ministry of Finance. Y.The rest of this page has been left blank intentionally - . US and a Bachelor of Arts (Honours) in Economics from University of Malaya. culminating as Secretary General to the Treasury. . namely AMFB. United Kingdom in 1986 and Certificate of Legal Practice (Honours) from the Legal Qualifying Board in 1987. Tan Sri Datuk Clifford Francis Herbert Tan Sri Datuk Clifford Francis Herbert. Tun Mohammed Hanif was the Inspector-General of the Malaysian Police Force for 20 years until his retirement in January 1994. Singapore in 1959. LLB (Honours) from Buckingham University. From 1994 to 2000. was appointed to the Board on 1 October 2005. Tan Sri Datuk Clifford is also involved in several NGOs. Bhg. Tan Sri Datuk Clifford holds a Masters of Public Administration from University of Pittsburgh. He has been the President of the Malaysian Institute of Management since 2001. He had been a board member of numerous statutory bodies and government related public companies among them being Kumpulan Khazanah Nasional Berhad. Bank Negara Malaysia. AHB. He retired from the civil service in 1997. Additionally.35 - . AmIslamic Bank and AmInvestment Bank. Shell Refining Company (Federation of Malaya) Berhad.Y. Tan Sri Datuk Clifford joined the Malaysian Civil Service in 1964 as Assistant Secretary in the Public Services Department from 1964 to 1968. Tun Mohammed Hanif received his Bachelor of Arts from the then University of Malaya. AmInvestment Bank and AmIslamic Bank. Deputy Chairman of Genting Berhad and Genting Malaysia Berhad (formerly known as Resorts World Bhd). Tun Mohammed Hanif also sits on the board of directors of AHB and other subsidiaries of AHB. the Securities Commission and Chairman of Percetakan Nasional Malaysia Berhad. Subsequently. A. Bhg. Malaysia Airline System Berhad.

Tan began his career in the financial industry with his attachment to BNM from 1959 to 1986. Cheah Tek Kuang Mr. was appointed to the Board on 15 June 2006. he was promoted to Managing Director. ASEAN. In 1989. Cheah Tek Kuang.36 - . Bhg. Tanjong Public Limited Company. Cheah has a Bachelor of Economics (Honours) degree from the University of Malaya and is a Fellow of the Institute of Bankers Malaysia. he joined Malaysian French Bank Berhad (now known as Alliance Bank Berhad) as Senior Vice-President and retired from office in October 1996. Tan Kheng Soon. a Malaysian. Asia and Corporate Development. Mr. Cheah’s directorships in other public companies include AlGB. Cheah joined AmInvestment Bank in 1978 and held various senior positions. foreign exchange. He also currently serves as a Council Member of the Association of Banks in Malaysia and is the Alternate Chairman of the Malaysian Investment Banking Association. Dato’ Gan is a Chartered Accountant. Mr. AmIslamic Bank. He was a Director of AmBank Berhad (now known as AmIslamic Bank) from 1999 until 2005. and was later seconded to Cagamas Berhad as its first General Manager in 1986. Bursa Malaysia Berhad and Cagamas Berhad. and he became the Group Managing Director of AmInvestment Bank from January 2002 to December 2004 before assuming the office of Group Managing Director in AHB. Mr. Mr. and was a member of the Ministry of Science and Technology Think Tank. Dato’ Gan Nyap Liou @ Gan Nyap Liow Dato’ Gan Nyap Liou @ Gan Nyap Liow. He served in various departments including economics. Dato’ Gan is currently the Chairman/ Director of Cuscapi Berhad and also a Director of Tien Wah Press Holdings Berhad. Mr. Mr. He was a partner for 16 years and had held many global leadership roles including Managing Partner for Malaysia. Cheah is currently the Group Managing Director of AHB and Chief Executive Officer of AmBank. Asia Pacific. a Fellow of the Association of Chartered Certified Accountants and a Certified Management Consultant. AmG Insurance Berhad. was appointed to the Board on 20 December 2001. until he was promoted to Manager of the Exchange Control Department. In 1994.Y. a Malaysian. . a global management and technology consulting firm for 26 years until his retirement in December 2004. He is an Investment Panel Committee Member of Kumpulan Wang Persaraan. Dato’ Gan was with Accenture. He remains as a NonIndependent Non-Executive Director of AmInvestment Bank. Dato’ Gan was also the Chairman of the Association of Computer Industry Malaysia and the Vice President of the Association of Asian Oceania Computer Industry Organisation. He is also a board member of AmIslamic Bank. a Malaysian. was appointed to the Board on 1 October 2005. exchange control and investment. Copyright Tribunal and the Labuan International Financial Exchange Committee. AMDB Berhad. Badan Pengawas Pemegang Saham Minoriti Berhad (Minority Shareholder Watchdog Group) and Saujana Resort (M) Berhad. Mr. Tan Kheng Soon Mr. AmLife.

namely AIGB. Mr. was appointed to the Board on 18 November 2008. Australia and India. requires him to proactively manage resources and trends to deliver superior financial performance in a challenging and competitive environment.The rest of this page has been left blank intentionally - . Ashok is accountable for the delivery of financial performance to meet the targets set by the Group Managing Director and AHB board of directors and to meet all financial regulatory reporting requirements. across multiple geographies including New Zealand. Ashok has over 20 years finance experience within ANZ. Ashok Ramamurthy Mr. He has been successful in developing and executing transformational strategy and leading large finance and shared services functions within ANZ. Ashok is currently the Deputy Group Managing Director/ Group Chief Financial Officer of AHB. Mr. Ashok is also a director in AHB’s subsidiaries. Mr. Mr.Mr. an Australian. Ashok Ramamurthy.37 - . AmInvestment Bank and AmIslamic Bank. As the Group Chief Financial Officer of AHB. Mr Ashok is the Senior ANZ representative in the AHB Group and accountable for building enduring relationships between ANZ and the AHB Group. This is a key role representing ANZ interests as a director in the Board and various sub-committees of the major subsidiaries of the AHB Group. . as a key member of the leadership committees. The role.

Datuk Mohamed Azmi first joined Arab-Malaysian Finance Berhad (now known as AMFB) in 1981 as an Accountant.4. th Business Banking of AmBank (M) Berhad. which he held until 14 June 2002 to assume the office of Managing Director.4 Profile of Key Management Mr. In 1994. he has developed Hong Leong Bank into one of the fastest growing banks in the country.3 of this IM. Dato’ James Lim Cheng Poh Dato’ James Lim Cheng Poh. a Malaysian. US. . Akademi IBBM Sdn Bhd. Retail Banking in AmBank with effect from 15 June 2002. a Council Member and Honorary Treasurer of the Association of Hire Purchase Companies of Malaysia. Over the years. AmG Insurance Berhad. a Malaysian. Datuk Mohamed Azmi is also a Director of AmLife. a position he held until 16 October 2003. He joined the Hong Leong Group in 1983 and held various senior positions and served in various capacities including insurance. properties and finance in the Hong Leong Group. he was seconded by BNM to First Malaysia Finance Berhad as its Chief Executive Officer in a rescue scheme of the finance company. He graduated from Camborne School of Mines (England) in Mining Engineering and holds a Masters Degree in Science (Engineering) from Queen’s University in Canada as well as a Masters Degree in Business Administration from Harvard University.8. he was appointed as the Senior Group Managing Director of Hong Leong Bank Berhad. In 1989. on 15 June 2004. Bhg. Dato’ James was appointed as a Director on the board of directors of AmLife. Financial Information Services Sdn Bhd and FIS Data Link Sdn Bhd. whereby AmFinance Berhad became AmBank (M) Berhad on 1 June 2005. a Member of the Council and Committee of the Institute of Bankers Malaysia.8. he rejoined AMFB and was promoted to Managing Director on 1 August 1994. Cheah Tek Kuang Please refer to Section 4. After the merger of the business operations of AmBank Berhad and AmFinance Berhad. He is a Fellow of the Institute of Bankers Malaysia.38 - . Ashok Ramamurthy Please refer to Section 4.3 of this IM. Bhg. In January 1991. joined AmBank Berhad as its Managing Director/CEO. Retail Banking of AmBank and has 28 years of experience in the banking industry.8. Under his leadership. he rose to become Senior General Manager. Prior to joining AmBank Berhad. Datuk Mohamed Azmi is also a Council Member and Honorary Treasurer of the Association of Finance Companies of Malaysia. MEPS Currency Management Sdn Bhd. AmMortgage One Berhad. he was then appointed as Managing Director. Y. Malaysian Electronic Payment System (1997) Sdn Bhd (MEPS). is currently the Managing Director. On 30 June 2005. Mr. he served in the Hong Leong Group for more than 20 years. Y. Datuk Mohamed Azmi Mahmood Datuk Mohamed Azmi Mahmood.

US. The previous position held by Datuk Mahdi was Executive Director. AMBB Capital (L) Ltd. AmCapital (L) Inc. United Kingdom in 1998. Currently. Bhg. She is a Fellow of the Chartered Association of Certified Accountants and a Member of the Malaysian Institute of Accountants. a wholly-owned subsidiary of AmInvestment Bank involved in futures broking. Datuk Mahdi serves as a director on the boards of various subsidiaries of AmBank. stockbroking and investment banking and private equity. offshore banking. venture capital and REITs management. She presently holds the position of chairperson for the Corporate Finance Committee of the Malaysian Investment Banking Association. she was the Executive Director of AmInvestment Bank since January 2005. She holds various directorships in the AmBank Group which includes the trustee services. He is also the Chairman of Arab-Malaysian Credit Berhad. he held various positions in Asia Commercial Finance Berhad and Sime Darby Plantations Berhad. a Malaysian. Mr. Prior to that. MBf Information Services Sdn Bhd. interest rate and commodities derivatives business.. Mr. He sits on the respective boards of directors of AmInternational (L) Ltd. is currently the Managing Director/Head of Treasury and Markets of the AmBank Group. Datuk Mahdi bin Morad Datuk Mahdi bin Morad. He joined Arab-Malaysian Finance Berhad (now known as AMFB Holdings Berhad) in 1989. Y. Retail Banking of AmBank. She is actively involved in industry development and works extensively with the regulatory bodies in Malaysia at consultative forums and on financial and capital markets matters. Prior to joining AmInvestment Bank. . he is responsible for the overall Treasury functions and business activities of the AmBank Group. Teng Chean Choy Mr. is currently the Chief Executive Officer of AmIslamic Bank Berhad. She has more than 25 years of experience in the investment banking and financial consultancy. Pushpa Rajadurai Ms. He joined the AmBank Group through the investment bank arm. Datuk Mahdi has a Bachelor of Science degree in Agricultural Business from Iowa State University. US and a Masters degree in Business Administration from University of Missouri.39 - . Teng obtained his Diploma in Management from the Malaysian Institute of Management in 1985 and a Master in Business Administration from the University of Hull. Teng Chean Choy. which includes foreign exchange. Before 2005. AmBank’s offshore banking subsidiary and AmFutures Sdn Bhd. he was the Treasury Manager of a large local bank. is currently the Managing Director of Corporate & Institutional Banking of the AmBank Group. she was the Director/ Head of Corporate Finance involved in both the equity and equity-linked business of the investment bank. AmProperty Holdings Sdn Bhd and AmCredit & Leasing Sdn Bhd. namely AmPremier Capital Berhad. Pushpa Rajadurai. AmInvestment Bank on 9 March 1995 as Group Treasurer. a Malaysian. she was attached to PricewaterhouseCoopers. Prior to joining AmInvestment Bank.Ms. Prior to this. a Malaysian.

Hong Kong and Malaysia wherein he has held a number of senior positions in Operations. Sim How Chuah. subsidiaries of AmBank. He was the General Manager for Operations and Transformation of ANZ Asia Pacific and was accountable for Operations across the various geographies. AMBB Capital (L) Ltd and AmCapital (L) Inc. a Malaysian. . Andrew Strain Kerr. where he has held key leadership and management positions. Portfolio Management & Policy.40 - . he was with BDO Binder from 1974 to 1984 where he was initially with the audit arm and his last position was a Director and Manager of the firm’s company secretarial unit. Mr. is currently a Senior General Manager in the Business Banking Division at AmBank.The rest of this page has been left blank intentionally - . Mr. Traded Market Risk. Asset & Liability Risk. Prior to joining AMFB. Mr. Ross Neil Foden. His role is to lead the consolidation of the operational functions across the AmBank Group and assist with improving their operational capabilities. Kerr has been very successful in instilling a strong credit culture both at the organisational and business unit levels. He joined Arab-Malaysian Finance Berhad (now known as AMFB Holdings Berhad) in 1984 and was subsequently transferred to AmBank in 1994. Mr. an Australian. He has worked predominantly in the areas of corporate finance and Risk Management (including extensive work on Basel II transition experience and as Chairman and/or member of Credit Risk. Sim How Chuah Mr.500 statff undertaking work for 16 countries. Kerr is responsible for the development and key leadership of the risk function within the AmBank Group. Ross worked with HSBC for over 29 years across the United Kingdom. Ross Neil Foden Mr.Mr. Operational Risk and Executive Management committees). is currently the Group Chief Operations Officer of the AmBank Group. ensuring the financial and reputational integrity of AmBank through an effective risk management framework. Prior to joining ANZ. He has over 28 years banking experience (including 8 years in South East Asia) with major international financial institutions (including 15 years with Bank of America and 5 years with ANZ). is currently the Chief Risk Officer of AmBank Group. He also serves as a Director on the board of directors of AmPremier Capital Berhad. He has more than 20 years of experience in the banking industry. At his last role as the Managing Director of HSBC Electronic Data Processing. product businesses and the Project Management Office overseeing more than 40 projects currently being implemented across the division. Andrew Strain Kerr Mr. Mr. he was accountable for over 3.

7 billion gross loans as at 31 December 2009 comprised mainly of loans for the purchase of transport vehicles. The AmBank Group’s retail assets (including Islamic financing sold to Cagamas Berhad. including Retail and Business Banking). Under this campaign. In recent years. credit cards and line of credit. EBCs. AmBank’s branches operate as full service retail banking shopfronts offering customers traditional retail banking products and services as well as bancassurance and investment services. deposits (savings accounts.9. demand deposits and fixed term deposits). AmBank benchmarks itself against banking practices and reviews and rewards branches that excel in customer service.I.8% of AmBank’s net profits are derived from its Retail Banking Division.1 Retail Banking AmBank’s Retail Banking services and products are offered across the following business units: auto financing. Responsive. AmBank’s operations have been divided into five business divisions: the Retail Banking Division. bancassurance.T. (which stands for Friendly. In addition. which per BNM guidelines are required to be accounted for as off balance sheet items) were RM42. AmBank has adopted a customer service campaign known as Customer F. the Corporate and Institutional Banking Division.R.S. personal financing/ co-operative loans. asset financing and small business (including leasing and equipment financing). ATMs.1 million customer accounts through its distribution network of branches. As at 31 December 2009.41 - . 24-hour customer contact centre.4. 4. 65. This service model is intended to ensure that branch personnel are simultaneously focused on providing efficient and effective service to customers whilst driving business growth with an entrepreneurial mindset. the Treasury and Markets Division and the Islamic Banking Division (which crosses AmBank’s various lines of business. for the purchase of residential properties. AmBank has increased the number of customer facing personnel in branches and also transformed the sales zone in its branches to ensure a more conducive environment for customer sales interactions. credit cards receivables and loans for personal use. mobile banking and internet banking services. and retail distribution (including transactional banking. Simple and Trustworthy). As at 31 December 2009. wealth management and the distribution of investment products and insurance products). the Retail Banking business served approximately 5. mortgages and other consumer loans. Innovative. .9 AmBank’s Businesses Following the completion of the Business Transfer. the Business Banking Division.

(a)

Auto financing The AmBank Group had RM25.3 billion loans outstanding in the purchase of transport vehicles sector, representing approximately 38.3% of the AmBank Group’s total loan portfolio as at 31 December 2009. The following table sets out the AmBank Group’s vehicle financing portfolio as at the dates indicated.
As at 31 March 2007 RM billion 22.74 As at 31 March 2008 RM billion 24.12 As at 31 March 2009 RM billion 24.35 As at 31 December 2009 RM billion 25.25

Loans for purchase of transport vehicles

AmBank has been focusing on rebalancing its portfolio by focusing on viable profit segments. AmBank has established relationships with over 4000 new, used and reconditioned vehicle dealers in Malaysia. AmBank also has strategic alliances with all of the major car manufacturers and car distributors in Malaysia. AmBank’s market share has grown in recent years as a result of AmBank’s pricing strategies, its focus on product innovations and service, and its continued relationships with vehicle dealers. AmBank continues to form new alliances with vehicle distributors so as to increase growth in, and diversify, its vehicle financing portfolio. Auto financing is usually offered on a fixed-rate basis, generally secured by the vehicle being purchased and typically has a term of three to seven years (with a maximum of nine years). The financing typically represents 75.0% to 90.0% of the assessed collateral value of the vehicle to be financed, depending on the credit assessment of the borrower, and the age of the vehicles. Prior to granting loans for used vehicles, AmBank requires an inspection by Pusat Pemeriksaan Kenderaan Berkomputer Sdn Bhd, the official vehicle inspection body in Malaysia to assess the roadworthiness of the vehicles. AmBank’s auto financing operations and fulfilment department has obtained the ISO 9001 certifications from the Department of Standards Malaysia, the United Kingdom Accreditation Service and the Comité Francais d’aAccréditation, for auto financing processing, documentation, disbursement and customer service. AmBank implements an automated credit scoring system as part of its ongoing efforts to improve credit risk management AmBank’s turn-around time in credit processing. AmBank continues to undertake marketing initiatives, participation in roadshows and sales promotions with vehicle distributors and dealers throughout Malaysia. AmBank intends to grow its auto financing portfolio by: (i) streamlining processing operations to five Business Centres in Klang Valley, 11 outside Klang Valley with 28 other Auto Finance Units spread across the nation; improving service and turn-around time in credit appraisals and disbursements via its automated credit scoring system;

(ii)

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(iii)

introducing more products, and programmes including a dedicated Dealer Management Programme; and conducting regular dealer satisfaction surveys and establishing tieups with new dealers.

(iv)

AmBank continuously reviews its risk management scorecards and credit scoring capabilities to offer customers differential interest rates according to their credit profile. In June 2007, AmBank won the Excellence in Automobile Lending Award for the Asia Pacific and Persian Gulf Region at the Sixth Asian Banker Excellence in Retail Financial Services Awards. In 2008, AmBank Auto Finance Division won another award – the Frost & Sullivan Award for Automotive Finance Company of The Year. (b) Mortgages and Other Consumer Loans In the residential mortgages segment, the AmBank Group had approximately 6.5% of the domestic market (including Islamic financing asset sold to Cagamas Berhad, which per BNM guidelines are required to be accounted for as off balance sheet items) as at 31 March 2009 with gross loan assets of RM11.3 billion. As at 31 December 2009, the financing of residential mortgages represented approximately 17.3% of the AmBank Group’s total loan portfolio. The table below sets out the AmBank Group’s residential property financing portfolio as at the dates indicated.
As at 31 March 2007 RM billion 10.73 As at 31 March 2008 RM billion 10.95 As at 31 March 2009 RM billion 11.31 As at 31 December 2009 RM billion 11.42

Loans for residential property

AmBank’s residential property loans normally have terms of between 20 and 25 years, with a maximum loan tenure of 30 years. Under construction residential property loans are typically provided on fixed-rate basis for a period of one to two years, and of variable rate for the remaining tenure, and are secured by a registered charge on the property being financed. As for completed residential property loans, the loan structure is mainly structured on variable rate for the whole tenure. Generally, interest on residential property loans is calculated on a daily reducing balance basis. AmBank’s marketing activities in relation to mortgages and other consumer loans include product-bundling initiatives and active participation in sales launches. AmBank also has strategic alliances with major housing developers to provide end financing packages to home buyers. In addition, AmBank has expanded the sales channels and emphasis on the extensive branch distribution channels. AmBank introduced several key initiatives to strengthen the retention program and further emphasised on the importance of loan quality with revised credit policies and processes. AmBank currently has five mortgage business centres in Kuala Lumpur, Penang, Johor Bahru, Kuching and Kota Kinabalu and three mortgage marketing hubs in Ipoh, Malacca and Kuantan, as well as offering mortgage products through its entire network of 189 retail branches through branch managers and a specialised sales force comprising personal bankers and consumer lending specialists.

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(c)

Credit Cards and Line of Credit As at 31 December 2009, AmBank was the seventh largest credit card lender in Malaysia based on credit card receivables amongst all credit card lenders. In addition to issuing its own credit cards, AmBank also has a strategic alliance with an independent credit card issuer, MBf Cards. Credit cards receivables owned by AmBank generated from cardholders of MBf Cards amounted to more than RM0.9 billion as at 31 December 2009. AmBank had financed about 1.0 million credit card accounts with total credit cards receivables of nearly RM1.9 billion as at 31 December 2009. AmBank issues MasterCard and Visa credit cards as well as Al-Taslif card-i through its wholly-owned subsidiary, AmIslamic Bank. Among others, AmBank has entered into several co-brand credit and prepaid card arrangements with RealRewards, one of the country’s largest cross-industry loyalty program operator and eCosway. The latest addition to the credit card family is True Visa, a no-frills card targeting the cost conscious and financially savvy segment. This product offers a monthly interest of 12% p.a. while allowing cardmembers the option to choose from an array of card features/benefits (frills) and pay for those that are utilised. AmBank is also undertaking cross-selling efforts to increase product holding ratio amongst the AmBank Group customers, offering product bundling offers to its corporate banking customers and retail lending products, such as residential property loans and auto financing. Other marketing initiatives implemented by AmBank include co-marketing programmes with AmLife. The recent alliances with global brands to offer gifts for balance transfer and quick cash on instalment repayment programme had brought in more than RM300.0 million of new receivables. As an extension to its Balance Transfer with gift promotion, AmBank introduced a separate credit limit for Balance Transfer in December 2009. This was a move by the Bank to retain its market share in light of the imposition of the Credit Card Service Tax. The new programme offers 1 card, 2 credit limits which allows cardmembers to consolidate outstanding balances from other cards to their AmBank while freeing the first credit limit for their usual card spend. In 2009, AmBank launched its Cash Rebate programme, offering up to 10% on essential items such as groceries and petrol, at all hypermarkets and on petrol brands. In June 2006, AmBank introduced prepaid cards in Malaysia and has penetrated into various key segments with its co-brand cards for the youth, multi-level-marketing organisations, payroll, foreign remittance and telecommunications. AmBank has, in November 2007, launched the AmBank i-Talk Prepaid MasterCard, a joint collaboration between Telekom Malaysia Bhd and AmBank. As at 31 December 2009, AmBank had sold over 327,000 prepaid cards, making it the largest prepaid card issuer in Malaysia. AmBank has enjoyed growth in its merchant acquiring business. Besides its own sales team, AmBank also has tie ups with Master Merchants to accelerate the take up of new merchants. Joint Marketing promotions which drive card usage at merchant outlets supported by AmBank’s communication channels is also seen as a key incentive for merchants to join AmBank. As at 31 December 2009, AmBank has about 9,000 merchants.

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(d)

Personal Financing/Co-operative Loans As at 31 December 2009, the AmBank Group ranked third in personal financing/co-operative loans, based on the published financial results of domestic and foreign financial institutions in Malaysia, with a market share of 7.1% and based on a gross financing portfolio of RM2.1 billion. The principal personal financing/co-operative loans products offered by AmIslamic Bank, a subsidiary of AmBank, is aimed at members of cooperatives who are government employees. The asset quality of such personal financing/co-operative loans is significantly enhanced by the payment method, which is typically via a deduction from monthly salary. AmIslamic Bank has launched various sales campaigns to increase AmBank and AmIslamic Bank brand visibility. From June to December 2009, AmIslamic Bank has launched campaigns such as “School Holiday”, “Duit Raya” and “Back to School”. Besides having personal financing facility, customers enjoy free gift and cash money during the campaign period.

(e)

Transactional Banking, Bancassurance and Wealth Management In addition to cross-selling deposit products through its various channels, emphasis is placed on distribution of lending products, such as mortgages, auto financing and micro loans. This business unit also offers customers access to investment products such as fixed income and equity unit trusts, insurance products (such as mortgage reducing term assurance, life, general and auto insurance) and other bancassurance products. In furtherance of AmBank’s strategy to grow market share in selected segments and share of customer wallet through cross selling initiatives, such investment and insurance products are substantially sourced from within the AHB Group. In rd addition, these products are complemented by products sourced from 3 party insurers and funds management houses to ensure AmBank customers have access to a broader range of products and services in the market. This business unit also oversees the operations of AmBank’s extensive customer facing channels inclusive of:189 branches nationwide 129 EBCs 190 cash deposit machines and 143 cheque deposit machines 745 ATMs 24 x 7 customer contact centres (inbound and outbound capabilities) internet banking mobile phone / device banking

(f)

Deposits The various deposit products offered by the Retail Banking Division include savings accounts, demand deposits and fixed term deposits. The Bank has grown its term deposits base by maintaining relationships with its customers and a pricing strategy to assist in funding asset growth. The Bank’s key strategies revolve around the concepts of: (1) (2) (3) Acquisition – understanding its key customer segments and meeting their Transact and Save needs; Activation – increasing transactionality and primary accounts; and Anti-Attrition – prevention to reduce dormancy and closure.

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all of which are intended to assist SMEs in accessing cheaper loan financing. In the pipeline for the next financial year of 2011 are a number of products and campaigns which are targeted at specific segments of the market as well as major broad based acquisition campaign to increase deposit balances specifically in low-cost deposits. in February 2007. bridging loans and syndicated loan participation). The introduction of the micro financing product is in line with the sovereign call to build up the SMEs sector. term loan. trade financing. the marketing team of AmBank’s Asset Financing and Small Business unit also focuses on strengthening its relationship with suppliers and vendors. AmMikro’s mandate is to provide unsecured term loans with fixed repayment periods to eligible micro enterprises for working capital purposes. friendliness and convenience. project financing. 4. The Business Banking Division has also established a Bumiputera unit that focuses on expanding our customer base to include Bumiputera entrepreneurs. commercial property loan. AmBank actively promotes BNM-funded loan schemes. The Business Banking Division also offers a lending programme (for both Conventional and Islamic) focusing on SMEs financing requirements in .9. launched AmMikro. bank guarantee and block discounting. and is driven by several factors such as convenience. the SMEs market segment has also been identified as a target market with high growth potential. As at 31 December 2009. such as the Fund for Small and Medium Industries and the New Entrepreneurs Fund.5 billion. (g) Asset Financing and Small Business Asset Financing and Small Business primarily provides financing products to SMEs. including working capital financing and other commercial loans (such as overdrafts. In addition. The products and services offered include: (a) Corporate Lending AmBank provides traditional corporate lending products and services. This growth comes from a growing base of customers who choose AmBank for their primary banking relationship. These are strategic initiatives designed to expand AmBank’s customer base and grow share of existing customers’ wallets whilst increasing balances in the deposit portfolio. AmBank has also.46 - . The Bank continues to focus on initiatives which will provide long-term sustainable growth specifically in low-cost deposits. Besides focusing on direct sales. revolving credit facilities. Government-Linked Corporations (“GLCs”) and statutory bodies. AmBank provides loan packages under various guarantee schemes of Credit Guarantee Corporation Malaysia Berhad. accessibility and branding. In ensuring SMEs are able to access to various financing products.These strategies are underpinned by the delivery of key customer proof points centred around the themes of simplicity. its micro-financing product. including industrial hire purchase. overdraft. the AmBank Group’s asset financing and small business gross loan portfolio amounted to RM2.2 Business Banking The Business Banking Division provides a wide range of products and services to Corporate and Commercial customers.

e. From a 13 ranking position in 2006. (c) Factoring The AmBank Group exposure to the factoring business stands at RM49. namely trade.respect of the purchase of commercial and industrial properties.0 million as at 31 December 2009. multi-national companies and large corporations. Kuching and Penang. This programme offers a more flexible and faster approval process compared to the approval process normally applicable within the Business Banking Division. The factoring lending programme has a more streamlined approval system which allows faster turnaround time for loan processing. five business centres have been set-up. This risk is mitigated as the assignment of receivables and collection are from a stronger-rated debtor party. The CBCs provide marketing services and serve as document collection centres. advanced payment guarantees. there are also 3 product teams. Factoring products offer attractive working capital financing instruments due to reasonable fees. The factoring lending programme focuses primarily on providing loans to contractors that supply products and services to government ministries and state agencies. (d) Cash Management and Transaction Management AmBank’s cash and transaction management product has been subscribed by more than 3. Kuala Lumpur. liquidity management and corporate Internet banking. Kota Kinabalu. The RBCs also cross-sell the Group’s products and services. The product is assisting customers to achieve efficiency in their daily transactions by streamlining transaction processing in their daily and routine cash management tasks.1 billion in receivables as at 31 December 2009. As part of the division’s strategy to extend its geographical reach. upfront mobilisation funding prior to commencement of work and certification of progress works. In addition. in Johor Bahru. Currently. The Business Banking Division intends to further increase its trade business to boost non-interest income. (b) Trade Services AmBank’s trade businesses contribute RM3. such as debt capital markets products. AmBank’s current cash management solutions include receivables management. AmBank has allocated RM500 million to a lending programme to support its factoring products.47 - . These RBCs are further supported by 12 CBCs strategically located throughout the country. th th . which supports the marketing arm in the provision of advisory service. The Business Banking Division customers are also supported by AmBank’s branch network in their daily transactional requirements.000 corporate customers. faster turnaround time and comprehensive associated services including performance guarantees. corporate finance advisory services and private banking products. AmBank has now moved up to the 5 spot in terms of trade assets size in Malaysia as at 30 September 2009. AmBank is also the largest non-government linked trade assets bank in Malaysia. payables management. i. new product development and operations. factoring and cash management.

such as oil and gas. With the increase in the coverage of banking solutions by this division. chemicals. who have been identified to specialise in selected growth industries. CIB focuses on the following areas of business: (a) Relationship Banking Relationship Banking provides clients with financial solutions. Offshore Banking The AmBank Group’s offshore banking operations in Labuan International Business and Financial Centre comprises Labuan Offshore Branch (“AmBank-LOB”) and AmInternational (L) Ltd (“AMIL”). energy and services as well as the plantation sectors. and providing financing to Malaysian corporations which undertake joint venture projects in Hong Kong. ensured more structured and systematic coverage of the market by its relationship managers.9. India. by marketing various products and services that the AmBank Group offers. in line with the AmBank Group’s strategic objectives. introduced structured lending programmes and contract financing programmes through the use of factoring services. Indonesia and Vietnam in the oil and gas. (b) CIB works closely with other divisions within the Group to structure value-added financial solutions for the AmBank Group’s clients. which focus on providing foreign currency financing solutions to Malaysian corporation venturing abroad. China. as well as offering of a wider spectrum of the AmBank Group’s commercial banking and investment banking products. palm oil. which include but are not limited to lending. debt and equity capital markets. metals.In the past year. as well as advisory and investment products. this division also plays a pivotal role in cross-selling the products and services of the AmBank Group. These include financing for cross-border acquisitions in Singapore and Indonesia. In addition. .3 Corporate and Institutional Banking Corporate and Institutional Banking (“CIB”) is a division which focuses on deepening and expanding banking relationships with the AmBank Group’s corporate clients. trade and cash management. and reengineered its end-to-end processes to allow for more speedy approvals of loan applications and timely usage of funds. which provide flexibility and speed for customers awarded with supplies and services contracts by Government ministries and agencies. Going forward. infrastructure and utilities as well as fast moving consumer goods sectors. the CIB teams are able to increase coverage of clients in various sectors. In addition. 4. AmBank has: strengthened its relationships with cross-border partners and added correspondent banks for ease of foreign clearing and trade transactions. the division has well-documented asset writing strategies to provide it with clear direction during the current financial market conditions. foreign exchange and derivatives.48 - . the broad strategies of the division will be to diversify and differentiate.

4 Treasury and Markets In line with the centralisation of the Bank’s existing treasury activities together with its collaborative partnership business in foreign exchange and derivatives.5 Islamic Banking The AmBank Group’s Islamic Banking business crosses AmBank’s various lines of businesses. AmBank and AHB have on 28 August 2008 entered into a Foreign Exchange. This is expected to be implemented by leveraging ANZ’s technical skills. Interest Rate and Commodities Technical Services Agreement (“TSA”) with ANZ to accelerate the expansion and development of the foreign exchange. As at 31 December 2009.9. The Treasury and Markets division provides capabilities for the trading of interest rates. This is further complemented by the AmBank Group’s extensive network of branches. AmIslamic Bank continues to build its relationship with existing customers as well as cultivate new ones in providing a complete range of retail and commercial banking products and services. With its universal banking license and 16 years of experience in offering Islamic banking products & services via the AmBank Group’s channels. corporate. interest rate and commodities derivatives products. interest rate and commodities derivatives business of the AmBank Group. Islamic investment banking transactions are often originated out of other corporate entities within the AHB Group. 4. In addition to its Islamic banking business activities. The AmBank Group offers a complete range of commercial and retail banking services to its clients through AmIslamic Bank. the AmBank Group was ranked fifth in Islamic banking (including Islamic window) based on total assets. third in Islamic hire purchase and second in Islamic credit cards in Malaysia (based on the published financial results of the 10 domestic banks in Malaysia).9.49 - . institutional and inter-bank markets. Following the strategic investment by ANZ in AHB. This is expected to fast-track the exponential growth of the AmBank Group’s market share in the expanding market for foreign exchange. the AmBank Group’s Islamic banking business had gross total financing (net of loans sold to Cagamas Berhad) of approximately RM12. and e-banking centres nationwide. ATM’s. risk. one of the key aspects of AmIslamic Bank’s operations is in paying its zakat contributions as part of its corporate social responsibility as well as duty as an Islamic business entity.4. processes and know-how in areas relating to sales and trading. Since its inception. The Islamic banking business applies the same credit approval process. As at 31 March 2009 and as compared to its competitors in the Malaysian market. SME. AmIslamic Bank has not only shown growth but has also capitalised on the robust demand for Islamic financial services. The following are some of the strategic initiatives that are being undertaken at AmIslamic Bank. The TSA represents a significant milestone in the roll out of the strategic initiatives which is expected to contribute considerable value-add as part of the AmBank Group’s strategic partnership to develop a sustainable and viable business for foreign and local customers of the AmBank Group and its subsidiary companies. derivatives and foreign exchange across every market segment including the consumer. the Group Treasury division whose responsibilities comprise the conventional and Islamic treasury activities of the Bank has been renamed as Treasury and Markets division. some of which have been completed: . credit scoring system and collateral policy as those of AmBank.3 billion. product development and systems.

a customer can invest funds in specific Islamic deposits that are linked to the Takaful plan. the AmBank Group is now adopting the brand name of “AmIslamic” in order to create and build a brand that is relevant and preferred for Islamic banking & finance both locally and globally. Synonymous with being the AmBank Group’s Islamic entity.50 - . Tie Ups & Alliances AmIslamic Bank has invested in tying up its products through various alliances and rd collaborations with 3 parties to expand its product reach and market penetration. This is expected to also provide a greater brand exposure and growth potential for AmIslamic brand in the global Islamic banking and finance scene (under the Malaysian Government’s initiative to promote Malaysia as a major hub for international Islamic finance through the Malaysian International Islamic Financial Centre (MIFC). The following are some of the initiatives: AmIslamic Bank had signed a tri-partite agreement with Takaful IKHLAS Sdn Bhd and FWU AG (which specialises in “white label” investment solutions for European and International distribution partners) to promote the distribution of a takaful investment-linked plan through AmIslamic Bank and AmBank’s branches throughout the country. A dual signage comprising signages of AmIslamic and AmBank throughout its shared branches network has also been introduced with the objective of strengthening AmIslamic’s brand visibility. a takaful institution and FWU AG. AmIslamic being an Islamic brand name is expected by the AmBank Group to be a more preferred brand for Islamic business activities/investors etc. . This was undertaken with the objective of enhancing its visibility and fulfilling the AmBank Group’s vision in making AmIslamic Bank the premier Islamic bank of choice in Malaysia and the region. and AmIslamic Bank’s granting to Perbadanan Tabung Pendidikan Tinggi Nasional (“PTPTN”) of a 10-year RM1.Dedicated branches As a key component of its business moving forward. funds management and ICBU products.e. AmIslamic Branding for the Group In an effort taken by AmIslamic Bank in conjunction with the International Currency Business Unit (“ICBU”) license granted by BNM.5 billion Bai’ Inah Term Financing guaranteed by the Government of Malaysia where AmIslamic is the financier and facility agent. Under this programme. “AmIslamic” shall be known as the promoting brand for all the Group’s Islamic products and services including investment banking. which began operations in November 2007. These 2-standalone branches are rd expected to be joined by a 3 branch to be located at IIUM in Gombak in June 2010. between an Islamic institution. AmIslamic Bank had been awarded the “Best Bancatakaful Award 2009” by the Malaysian Takaful Association for AmIslamic Bank’s sales of AmHigh Takaful. AmIslamic Bank has set up 2 dedicated branches in Bandar Baru Bangi and Putrajaya. This has made Malaysia the first country to introduce such a partnership i. To-date.

a major international banking and financial services group The partnership with ANZ enables AmBank to leverage on the international expertise and strengths of ANZ. AmIslamic Bank signed a Memorandum of Participation for Bursa Commodity House (“BCH”). BCH is Shariah-compliant web-based commodity trading platform aimed at facilitating commodity murabahah transactions for the development of the Islamic financial market infrastructure as well as to facilitate liquidity management for Islamic financial institutions. AmBank believes that the following benefits will be derived by AmBank from the AHB Group's strategic partnership with ANZ: (i) Risk Management Framework: ANZ has a proven track record in transferring risk capabilities to its partners. which capital in turn was injected into AmBank to strengthen its balance sheet and place AmBank in a stronger position in the Malaysian and international markets. as ANZ brings with it its international best practices as well as exposure to international products. (ii) .10.1 Strategic partnership with ANZ. AmMomentum Select Islamic Negotiable Instruments of Deposit (NID-i). given the expected enhancement of its product development abilities and risk management practices. BCH is a MIFC initiative operated by Bursa Securities’ wholly-owned subsidiary. house financing product with flexible rate features as opposed to fixed rate financing. 4. and the Wakalah Deposit Investment account for corporate customers and interbank placements.Retail and Business Banking Activities In 2009. The equity participation of ANZ is expected to enable AmBank to compete more effectively against international banks.10 Competitive Strengths AmBank considers the following to be its principal competitive strengths: 4.51 - . auto financing. ANZ’s credit card business in other Asian markets is expected to enable AmBank to adopt ANZ’s best practise and capture a larger share of the fast-growing Malaysian credit card market. The capital infusion provided by ANZ through its equity participation in AHB. banking systems and cross border capabilities. knowledge transfer on Basel II implementation and enhancement of financial discipline. ANZ’s experience with SMEs will also enable AmBank to leverage ANZ’s vast corporate banking experience for business expansion purposes. the major focus was on growing the AmBank Group’s retail and commercial business. In this regard. Retail and Business Banking: ANZ has experience and capabilities in deposit-raising strategies. an Islamic structured deposit. Bursa Malaysia Islamic Services Sdn Bhd. a number of new products and programmes were introduced: Flexi Bai’ Bithaman Ajil for House Financing-I. This includes improvements of credit risk management systems. mortgages and branch service enhancement.

10. Further. AmBank is expected to also gain exposure to ANZ’s highly automated banking processes and centralised back office operations. (iv) (v) (vi) (vii) On 28 August 2008. with the technical expertise from ANZ. Training and Development: With staff secondment and training. The AHB Group is leveraging on ANZ’s markets sales.10. ANZ’s best practices in the area of compliance are expected to enable AmBank to enhance its internal auditing and reporting systems. 4.52 - . Branding: It is envisaged that ANZ will add significant credibility and provide a “unique selling point” for AmBank to position itself as a domestic bank with a significant foreign shareholding. Silver Award Best Contact Centre Telemarketer (Open). trading. Silver Award Best Contact Centre Manager (Below 100 seats). product development and process skills to set foundation for a sustainable markets business in the Group. Besides its network of dedicated nationwide marketing officers and personal bankers. AmBank offers recently-upgraded Internet and best in class mobile phone banking facilities to all of its customers. Silver Award Best Contact Centre Support Professional (Below 100 awards). In addition. IT Infrastructure and other Operations: AmBank is expected to be able to leverage on ANZ’s international standards and IT practices for the enhancement of its existing IT infrastructure. Regional Presence and Cross-Border Transactions: The partnership is expected to also provide AmBank with access to ANZ’s wide international network for remittance. sales and financial services personnel and agents.(iii) Product Innovation: AmBank will have access to ANZ’s products and services expertise for product enhancement and innovation as well as crossselling activities via AmBank's existing franchise and distribution channels. trade finance operations and investment banking cross border dealflow.2 Extensive and diversified distribution network AmBank currently operates 189 branches (including 2 dedicated Islamic banking branches). (ii) mortgages and other consumer . 4. 745 ATMs and 129 self-service EBCs in Malaysia. interest rate derivatives and commodities business. AmBank is expected to be able to absorb and implement ANZ’s international service standards to enhance the overall quality of its human capital. and further strengthen its brand equity.3 Extensive and diversified retail banking business AmBank has established a retail franchise and has established a niche in Islamic Banking and offers a diversified range of retail banking products and services covering seven principal areas: (i) auto financing. AmBank received the following awards: Best Telemarketing Contact Centre (Open). Silver Award Mystery Shopper Results (Telemarketing). The business aspiration is to build complete and integrated end-to-end solutions that add significant value across the Group’s business segments including retail banking. In addition to its branch network. risk. IT. business banking and corporate banking. AmBank also leverages on the sales force in the AHB Group which comprise marketing. Bronze Award AmBank intends to expand its network of branches to more than 200 in key growth corridors and highly populated areas by AmBank’s chosen customer segments in the short to medium term. the AHB Group has established the foreign exchange. AmBank has a 24-hour customer contact centre aimed at providing its customers with th convenient point of contact. At the 10 CCAM Annual Contact Centre Awards held on 6 November 2009.

AmIslamic Bank is the fifth largest Islamic bank in Malaysia in terms of asset size as at 30 September 2009. a wholly-owned subsidiary of AmBank.4 Leading market position in key products AmBank is the second largest provider of auto financing in Malaysia.10. (iii) credit cards and line of credit.5 Ability to provide and cross-sell a wide range of products and services As part of the AHB Group. demand deposits and fixed term deposits).loans.6 Established and reputable brand name AmBank believes it has established a reputable and recognised brand name in Malaysia. AmBank is also a leading Islamic banking franchise. and currently has relationships with over 4. By applying these values. 4. AmBank had also embarked on a first-of-its-kind mortgage facility for Telekom Malaysia Berhad (TM) via AmMortgage One Bhd. AmBank has strong business alliances with almost all car manufacturers and principals. (vi) retail distribution (including transactional banking. These relationships provide an extensive distribution network for AmBank’s auto financing products.I. Its subsidiary.53 - . franchise holders as well as a very strong and established network with the used auto dealers. currently the largest non-bank credit card issuer in Malaysia for the provision of credit card financing. Responsive. bancassurance. with a market share of approximately 21% as at 31 December 2009. In addition. In effect. unit trust funds (which AmBank cross-sells with AmInvestment Bank). AmBank has engaged continuous alliances with major housing developers and participated in major property roadshows. and (vii) deposits (including savings accounts. and the second largest Islamic credit card issuer in Malaysia. AmBank strives to be the best bank in Malaysia and seeks to provide exceptional customer service. 4. 4. (iv) personal financing/co-operative loans. wealth management and the distribution of investment products and insurance products). standing for “Friendly. This recognition was accorded on 1 November 2009 and depicts the strength of AmBank’s brand in Malaysia. Innovative. AmBank’s brand values are expressed through the acronym “F. . insurance products (which AmBank cross-sells with AmLife) and securities trading services offered by other members of the AHB Group.10. AmBank also has relationships with government co-operatives to expand its personal financing/co-operative loans services throughout Malaysia.R.8 billion.10. the AmBank Group’s retail assets were RM43. (v) asset financing and small business (including leasing and equipment financing). In the auto financing sector. making it a “one-stop” financial centre for customers. AmBank is able to leverage a group-wide sales force to assist it in offering a wide range of products and services provided by other members of the AHB Group. At AmBank’s branches. for example. the said facility involves the outsourcing and securitisation of TM employees’ residential loans. This range provides AmBank with an extensive retail loan base. The AmBank Group was selected as one of the Top 30 Most Valuable Brands in Malaysia through a brand valuation exercise carried out by the Association of Accredited Advertising Agents Malaysia in collaboration with The Edge Malaysia.”. As at 31 December 2009.000 dealers in Malaysia.T.S.7 Important strategic alliances AmBank has entered into a number of strategic alliances including an arrangement with MBf Cards. AmBank is committed to the satisfaction of its customers.10. Simple and Trustworthy”. customers can purchase. 4. commanding a 31% market share. measured by the total amount of credit card receivables outstanding as at 30 September 2009. In June 2009.

AmBank has forged a strategic alliance to install 400 ATMs at 7-Eleven stores (24-hour convenience stores) nationwide. low rate cards. banking systems and cross border capabilities. revenue and profitability via free for life programs.11 Strategy AmBank’s focus is to achieve sustainable and profitable growth within its risk management framework. and are as follows: 4.54 - . Business Areas Auto financing Current Focus • • • • • • • • • Personal financing/Cooperative loans Asset financing and small business • • • • • • Grow profitability via segmentation approach Enhance risk based pricing models Improve dealership management Grow its middle to high end market segments Focus on secondary refinancing & owner occupied housing Adopt rigorous risk based approach to investment properties Grow cards base. AmBank’s principal strategies are in alignment to the overall strategies of the AHB Group. In order to achieve this objective. the Group is currently evaluating the timeframe to achieve its medium term aspirations. ANZ brings with it its international best practices as well as exposure to international products.1 Maximise income. family cards and cobranding Enhance focus on merchant acquisition Be “card of choice” by increasing product holding ratio Build relationships to grow receivables and profitability Enhance customer service Enhance bundling Enhance retention strategies Build strategic alliances with machinery dealers & suppliers Introduce new loan packages and focus on industrial hire purchase refinancing Mortgages Credit cards . AmBank aims to meet the needs of its customers and develop innovative and competitive products and services. utilisation. AmBank intends to leverage on the international expertise and strengths of ANZ. 4. Amidst the current global economic challenges that have arisen since then.AmBank has introduced NexG prepaid credit cards and is the largest issuer of the prepaid card in Malaysia and has an alliance with one of its key strategic partners. To best effect each of the business strategies enumerated below. TM to issue a co-branded prepaid card with iTalk airtime.11. there are 342 AmBank ATMs at selected 7-Eleven stores. Other key strategic alliances include e-Cosway and RealRewards. continue to deliver profitable growth and meet its return on equity targets by focusing on its core business areas The AHB Group had in late 2007 announced its medium term aspirations which include an intention to double its 31 March 2007 underlying net profit after tax and attain a return on equity of 17% to 20%. In addition. AmBank aims to meet these targets by continuing to focus on its core business areas. At present.

automation and outsourcing. to generate obligor’s probability-of-default.4 Differentiate and enhance customer experience AmBank aims to elevate the customer experience through brand differentiation and migration of customer transactions to preferred and more cost effective delivery channels. a cost to income ratio of circa 40%. feasible business plans and operating in viable sectors Business Banking • • • 4. The AHB Group also seeks to reduce its costs and increase its efficiency in various other aspects of its business and attain. From an operational perspective.11.11.11. AmBank has established a centralised retail collection centre to focus on maximising recovery efforts. while simultaneously reducing the interest rate volatility risk in its funding costs. regional and domestic economic downturn. AmBank aims to centralise its key processes and backroom activities to increase its efficiency.55 - . AmBank consistently monitors its brand position in the market and is dedicated to the enhancement of its brand positioning and brand awareness amongst consumers. loss-given-default and exposure-atdefault. AmBank aims to move towards the target by improving its funding and liquidity profile. and emerging and mass affluent segments Activation focus on payroll crediting and direct credits and debits Anti-attrition focus to prevent dormancy Entrench business in preferred and stable industries in accordance to government stimulus packages Maintain good relationship with existing customers through excellent service Target new customers with good track record. AmBank also aims for further operational enhancement via simplification. with a particular focus on customer profitability in all sales acquisition programmes and campaigns. 4. in the medium term.Deposits • • • Acquisition focus on transact and save needs of mass market. . AmBank aims to strengthen its credit risk infrastructure and improve its risk assessment processes with the goal of further refining credit scoring across all retail products. AmBank aims to streamline performance management activities to align targets across its banking business. a targeted reduction in its funding costs. collections and risk management policies The AHB Group aims to reduce its net NPLs ratio to below system levels in the medium term upon recovery from the current global. small businesses.2 Decrease cost of funds in tandem with enhancements to cost efficiency The AHB Group has outlined as part of its strategic aspirations. 4.3 Reduce NPLs and strengthen receivables management. building its deposit distribution capabilities and creating depositfocused product units. With respect to its employees. New and enhanced rating models are expected to be launched in 2010.

Friends Provident Fund PLC and Insurance Australia Group Ltd currently holds 30% and 49% stakeholding in the life insurance and general insurance businesses respectively.4. AmBank also intends to further enhance the synergies between its existing divisions and the newly transferred divisions. . Following the Business Transfer.11.11. AmBank cross-sells these insurance products at its branches and via its personal bankers. 4. In the insurance business segment of the AHB Group.The rest of this page has been left blank intentionally - . reduce operational cost by achieving cost efficiencies. Retail Banking and Corporate and Investment Banking divisions AmBank currently aims to utilise the synergies of its Business Banking and Retail Banking divisions to: reduce the cost of borrowing by achieving CASA (“Current Accounts Saving Accounts”) portfolio growth. including offering overdraft services and additional international remittance services.56 - . and introduce new products and services. These strategic partnerships provide benefits to the AHB Group in the form of more sophisticated product development and improved analytics.6 Extend distribution of banking products and services to all branches AmBank aims to extend its comprehensive banking products and services to all of its branches.5 Leverage the synergies of AmBank’s Business Banking.

1) 4.1 2.1) 600.025.8) 1.209.348.3 (2.5 3.210.007.1) 466.2) 1.4 (59. 5.4) (362.3 0.3 (748.6 (430.2 (982.8) 3.7) (83.57 - .004.0 2.2) (12.6) (415.7) 1.201.3 177.2 701.6) 1.9 0.0 (89.7 (1.1 (864.1 2.2) (219.09 60.2 (2.1 (362.37) - 71.0) (58.5) 701.724.1) RM million RM million 4.6) 1.334.4) 737.652.71 86.19 .7 (349.1 466.414.7 3.0 305.1 3.332.7) (0.1 2.8 518.011.66 89.2 (857.0) (309.7 0.255.1 (1.3 508.1 FINANCIAL INFORMATION Financial Highlights A summary of the consolidated financial statements of the AmBank Group based on the audited financial statements for the past three (3) FYEs 31 March 2007 to 2009 as well as the unaudited financial statements for the nine (9) months financial period ended 31 December 2009 are as follows: FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million RM million Income Statement Revenue Interest income Interest expense Net interest income Net income from Islamic Banking business Other operating income Share in results of associates Net income Other operating expenses Operating profit Allowance for losses on loans and financing Provision for commitments and contingencies Impairment loss Profit/(loss) before zakat and taxation Zakat Taxation Profit/(loss) after zakat and taxation Net Profit/(loss) attributable to equity holder of AmBank Earnings per share (sen) Basic Fully diluted 4.3) (225.7 (1.8 370.4 600.5) 1.8 283.5 538.8 (0.698.4 493.23 104.6) (271.446.374.6 (553.2 820.301.788.57 73.7 2.7 (1.1 1.5.8) 54.232.317.197.5) 1.431.6 (1.5) 1.777.433.3) 8.866.

5 629.641.0 421.1 0.7 4.6 0.3 825.947.465.6 344.970.21 0.244.3 130.0 827. advances and financing Other assets Statutory deposit with BNM Deferred tax asset Investment in associates Prepaid land lease payments Property and equipment Intangible assets TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Obligations on securities sold under repurchase agreements Bills and acceptances payable Recourse obligation on loans sold to Cagamas Berhad Other liabilities Subordinated term loans Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Term loans and Revolving Credit Capital Securities Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-Cumulative Convertible Preference Shares Total Liabilities Share capital Reserves Minority Interests Total Equity TOTAL LIABILITIES AND EQUITY Net assets per share (RM) 1 Gearing ratio (times) RM million RM million Third Quarter Ended 31 December 2009 (Unaudited) RM million 9.768.5 818.454.1 56.4 4.557.0 6.526.5 - 7.2 140.0 575.8 1.4 2.6 2.7 776.7 - 7.1 16.0 60.117.0 0.6 985.76 0.4 477.461.877.2 119.7 88.4 5.6 1.972.9 3.5 88.5 863.384.FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) RM million Balance Sheet ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.4 3.7 62.8 192.8 500.316.0 400.3 3.1 1.387.8 754.0 575.6 43.9 150.9 37.909.202.4 1.9 150.0 795.1 1.8 1.468.6 63.0 239.6 181.135.0 - 58.342.5 150.527.1 75.0 689.739.752.0 145.342.0 1.9 .15 0.4 565.0 131.4 3.0 684.860.0 575.3 64.141.5 2.866.6 702.7 610.8 1.7 5.034.933.0 - 1.2 208.2 670.1 6.153.8 84.5 64.2 0.0 6.3 12.0 1.9 54.970.1 67.9 1.223.1 171.9 3.4 656.7 444.327.3 5.7 460.0 517.9 410.0 - 1.5 62.67 0.7 2.471.6 8.120.7 71.117.801.9 7.5 753.8 4.2 670.982.771.0 460.4 17.570.7 47.58 - .949.5 860.535.4 4.8 400.7 1.058.532.5 1.570.5 63.598.870.8 61.4 350.4 84.0 79.4 1.2 66.2 155.4 13.180.460.1 1.3 598.1 - 1.4 85.968.638.106.4 168.725.0 610.2 229.046.7 548.725.046.451.0 83.0 600.9 41.2 600.

the results of business transferred from AmInvestment Bank together with the assets and liabilities are included in the financial statements of the AmBank Group as if the merger had been effected prior to and throughout the current financial year reclassification arising from changes in presentation with effect from April 2008 and April 2009. MTN.59 - . term loan and revolving credit. irredeemable convertible unsecured loan stocks (liability portion). vested to the AmBank Group in FYE 2009 under the pooling of interest method under Malaysian Generally Accepted Accounting Practices (“Merger Method”). The summary consolidated financial statements of the AmBank Group for the FYE 31 March 2008 had not incorporated the restatement as follows: i) inclusion of financial results of AmInvestment Bank’s fund based activities including its 100% owned subsidiary.The rest of this page has been left blank intentionally - .Notes: The summary consolidated financial statements of the AmBank Group for the FYE 31 March 2007 had not incorporated prior year adjustments/ restatements as follows: i) the adoption of BNM’s revised guidelines on Financial Reporting for Licensed Institutions (BNM/GP8) in respect of the treatment of derivative financial instruments the adoption of new and revised FRSs that are applicable to the AmBank Group with effect from April 2007 ii) iii) inclusion of financial results of AmInvestment Bank’s fund based activities including its 100% owned subsidiary. Under the Merger Method. AmInternational (L) Ltd. . April 2008 and April 2009. irredeemable noncumulative convertible preference shares. Capital Securities. AmInternational (L) Ltd. Under the Merger Method. hybrid securities. subordinated bonds. vested to the AmBank Group in FYE 2009 under the pooling of interest method under Malaysian Generally Accepted Accounting Practices (“Merger Method”). exchangeable bonds. ii) The summary consolidated financial statements of the AmBank Group for the FYE 31 March 2009 had not incorporated the restatement for reclassification arising from changes in presentation with effect from April 2009. iv) reclassification arising from changes in presentation with effect from April 2007. 1 Comprising subordinated term loans. the results of business transferred from AmInvestment Bank together with the assets and liabilities are included in the financial statements of the AmBank Group as if the merger had been effected prior to and throughout the current financial year.

74% 13.92% 16.55% 115. Return on equity means net profit for the year/ period as a percentage of the average of beginning and year/ period-end shareholders’ funds. securities purchased under resale agreements. then the core capital is equivalent to the capital base.09% 0. if the total of investment in subsidiaries and holdings of other banking institutions’ capital is greater than the Tier 2 capital of the banking institution.08% 2.61%) (10. .57% 74.45% 3.91% 6. Core capital ratio means the ratio of Tier 1 capital to risk-weighted assets calculated in accordance with BNM guidelines.42% 7. securities available-for-sale.56% 94.94% 117.62% 0.55% 2.16% 54. including net financing income and hibah from Islamic Banking business. securities held-fortrading. advances and financing (before deduction of Islamic financing sold to Cagamas Berhad) less specific allowance. (2) The ratios for the nine (9) months ended 31 December 2009 are annualized.57% 65. advances and financing) including Islamic Banking assets. deposits and placements in banks and other financial institutions.04% 37.98%) 2. securities held-to-maturity and loans. Cost to income means operating expenses as a percentage of the net income.91% 10. as a percentage of the average of beginning and year/ period-end interest-earning assets (comprising cash and short-term funds. Risk-weighted capital ratio means the ratio of total capital base to risk-weighted assets calculated in accordance with BNM guidelines.83% 88.81% 1.37% 14.35% 9. Net NPL ratio means non-performing loans less specific allowance as a percentage of gross loans.60 - .44% 38.The rest of this page has been left blank intentionally - . However. Net interest margin means net interest income.35% 5.94% 17. Loans to deposits ratio means net loans. advances and financing as a percentage of deposits from customers.70% 9.88% Notes: (1) The Financial Ratios used are defined as: Return on assets means net profit for the year as a percentage of the average of beginning and year/ period-end total assets. Loan loss coverage ratio means total specific allowance and general allowance for bad and doubtful debts as a percentage of gross non-performing loans.08% 13.05% 3.77% 92.The following financial ratios of the AmBank Group are unaudited: FYE 31 March 2007 FYE 31 March 2008 FYE 31 March 2009 Third Quarter Ended 31 December 2009 Financial Ratios Return on assets (2) Return on equity (2) Net interest margin Net NPL ratio Loan loss coverage ratio Loans to deposits ratio Cost to income Core capital ratio Risk-weighted capital ratio (2) (0.11% 3.42% 39.30% 0.73% 40.25% 14.

The AmBank Group also set aside impairment loss of RM213. only 50% of the realisable value is assigned to the properties held as collateral for NPLs which are in arrears for more than five (5) years but less than seven (7) years.8 million on debt converted securities. Other operating income decreased mainly due to loss in revaluation of securities held-for-trading impacted by rising interest rates and domestic economic conditions.5 million. AHB. In the same month. The MTN issued had been included as Tier 2 capital under the capital adequacy framework for financial institutions. the AmBank had issued five tranches of MTN totaling RM860 million under the MTN Programme.2 Commentaries on Past Performance FYE 31 March 2007 On 1 May 2006. Net interest income increased mainly due to increase in interest on loans. the AmBank Group is aiming for maximum optimisation of its services to further propel its Islamic banking services. FYE 31 March 2008 The year 2008 represented a year of performance turnaround for the AmBank Group. This change in the method of provisioning has resulted in an additional specific allowance charge for the year of RM515.5.7 million (excluding the impact of prior year adjustments and contribution from fund-based activities vested over from AmInvestment Bank) for the year due to higher loss allowances as a result of adopting a more prudent provisioning policy on loans. Operating expenses increased due to the impact of back-dated salary cost (accruing since financial year ended 31 March 2006) for union employees.5% per annum every subsequent year to maturity date. no value is assigned to the realisable value of the properties held as collateral for NPLs which are in arrears for more than seven (7) years. advances and financing attributable to loan growth and lower NPLs. On 11 March 2008. Further. AmIslamic Bank issued RM400 million Subordinated Sukuk Musyarakah (“Sukuk Musyarakah”) for purposes of increasing AmIslamic Bank’s capital funds. During the year. AmBank prepaid the RM680 million subordinated term loan facility to Astute Assets Berhad. The Sukuk Musyarakah is for a period of ten (10) years and carries a profit rate of 4. a wholly owned subsidiary of AmBank.61 - . . Accordingly. which fell to 3. Debt provisioning charge registered a significant decline as a result of the more stringent provisioning policy adopted with effect from previous year coupled with lower net NPLs. During the year.8% per annum for the first five (5) years and shall be stepped up by 0. a specific allowance of 20% is provided on NPLs which are more than three (3) months but less than six (6) months in arrears. the Group registered a pre-tax profit of RM737. From a loss position in the previous financial year.16%. its wholly owned subsidiary. to formalise the corporate separation of the conventional banking business from the Islamic banking business. the Islamic Banking business of AmBank was transferred to and vested into AmIslamic Bank. advances and financing and debt converted instruments. With the new Islamic operational structure in place and ongoing effective communication with its customers. the ultimate holding company announced a Proposed Group Internal Restructuring whereby the fund-based activity of AmInvestment Bank shall be transferred to and vested in AmBank for conventional business and AmIslamic Bank for Islamic banking business pursuant to the vesting order issued by the High Court of Malaya at Kuala Lumpur.57% from 6.8 million (excluding the contribution from fund-based activities vested over from AmInvestment Bank). the AmBank Group adopted a more stringent basis for charging specific allowances on NPLs. On December 2006. The proceeds raised from the MTN programme had been utilised for the refinancing of existing subordinated debts and for general working capital requirements. The AmBank Group reported a loss before zakat and taxation of RM415.

The increase was offset by higher loan losses due to loan growth. The AmBank Group registered a profit before zakat and tax (“PBT”) of RM 1.8 million under the MTN Programme. collections and recoveries management. On 10 December 2009. The interest rate will step up by 0. the Group’s risk-weighted capital ratio remains strong at 14. AmBank also undertook the issuance of Non-Innovative Tier 1 (“NIT1”) Capital programme of up to RM500 million in nominal value comprising Non-Cumulative Perpetual Capital Securities which are issued by the Bank and stapled to Subordinated Notes issued by AmPremier Capital Berhad. collectively known as Stapled Capital Securities. Net income from Islamic Banking business increased by RM100.0 million Innovative Tier I Capital Securities under its RM500. The increase in PBT was attributable to higher investment income and write back of provision for commitments and contingencies arising from recovery of the capital markets and higher net income from the Islamic Banking business.000.5% mainly driven by strong growth in financing and advances and lower income to the depositors despite the strong growth in deposits. The proceeds from the NIT1 program were used for working capital purposes. The proceeds raised were utilized for general working capital requirements. The ITICS has been assigned a long term rating of A3 by RAM Ratings and rank pari passu with other Tier I securities and the most junior class of preference shares but above ordinary shares. The Stapled Capital Securities comply with BNM’s Guidelines on Non-Innovative Tier 1 capital instruments. During the period. the fund-based activity of AmInvestment Bank was transferred to the Bank and AmIslamic Bank. The said tranche is for a tenor of 10 years non-callable 5 years and bears interest at 5.62 - .5% per annum at the beginning of year 6 and every anniversary thereafter.62%.00 each. preceding the maturity date.7 million for the year due to increase in net interest income arising from loan growth and reduction in allowances for losses on loans and financing.77%. During the year.011. Net NPLs of the AmBank Group continued to improve to 2. As at 31 December 2009.0 million Innovative Tier I Capital Securities (“ITICS”) Programme. AmInvestment Bank’s wholly-owned offshore bank subsidiary.75% per annum. The increase in net interest income was partially offset by lower other operating income and increase in operating expenses. higher operating expenses due to higher personnel costs with the increase in head count and impairment loss on securities.FYE 31 March 2009 Effective 12 April 2008. As at 31 March 2009. Lower provisions were underpinned by improved credit control.88%. Unaudited financial statements for the nine (9) months financial period ended 31 December 2009 The AmBank Group registered a PBT of RM820. The proceeds raised were utilised for the refinancing of existing subordinated debts and general working capital requirements. a wholly-owned subsidiary of the Bank.7 million representing a 5. AmBank issued the seventh tranche of MTN amounting to RM97. . AmBank issued up to RM485.000 fully paid ordinary shares of RM1. the holding company. On 20 May 2008. AMIL was also transferred to AmBank via a share transfer.0% increase compared to the PBT from the corresponding period last year.1 million or 24.57%. Net NPLs of the AmBank Group continued to improve to 1. AMFB exercised its conversion right to convert the entire RM300 million irredeemable convertible unsecured loan stock (“ICULS”) into 60. the Group’s risk-weighted capital ratio remains strong at 14. The proceeds raised were utilized for general working capital requirements. AmBank issued the sixth tranche of MTN amounting to RM600 million.

7 1.0 57.3 942.3 3.471.2 155.180.7) 1.471.468.8 770.947.153.316.1 7.7 5.084.909.1 7.6 377.9 444.6 1.683.0 493.8 500.8 1.4 67.460.1 60.2 4.0 239.4 Loan Capital Subordinated term loans Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Term loans and Revolving Credit Capital securities Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-Cumulative Convertible Preference Shares Total Liabilities Equity Share capital Reserves Share premium ICULS (equity component) Statutory reserve Merger reserve Capital reserve Available for-sale reserve Other reserves Unappropriated profits Total Shareholders’ Funds Minority Interests Total Equity 460.0 776.0 600.6 702.3 Capitalisation and Indebtedness The following table sets out the capitalization and indebtedness of the AmBank Group based on the audited financial statements for the past three (3) FYEs 31 March 2007 to 2009 as well as the unaudited financial statements for the nine (9) months financial period ended 31 December 2009.8 849.6 565.1) 735.056.972.9 1.121.860.3 75.466.384.180.9 4.6) 1.2 600.0 150.9 349.327.5 410.5 (2.0 1.0 145.223.7 41.135.8 400.8 927.506.2 610.8 85.0) (79.7 .5 45.2 349.641.0 825.4 1.535.7 57.0 150.9 16.3 1.7 710.768.5 (44.63 - .0 1.557.0 684.120.7 79.866.0 377.4 63. FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million RM million Short-term and long-term liabilities Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Obligation on securities sold under repurchase agreements Bills and acceptances payable Recourse obligation on loans sold to Cagamas Berhad Other liabilities RM million RM million 37.5 6.752.357.0 5.0 377.4 670.0 131.6 397.0 575.877.461.8 83.451.5 (38.870.7 200.0 - 460.2 208.4 1.2 397.0 3.752.7 79.4 670.744.5 12.2 58.880.5 2.1 3.0 575.6 985.202.7 3.4 610.5 860.0 575.813.7 633.7 4.0 689.4 710.9 3.6 377.5.1 1.8 942.0 400.2 140.8 4.6 150.202.

9 RM million 64.9 RM million RM million 2.168.268.64 - .811.5 16.0 31.342.211.6 3.870.3 44.7 12. The rationale for the reclassification is to facilitate better peer comparison as the reclassification is in line with industry practice.1 13.6 RM million 84.8 63. 745 ATMs and 129 electronic banking centres nationwide.535.5 3.725. The overall strategy is to enlarge the distribution footprint and branch network (currently the fourth largest domestic network) plays a pivotal role in depositing gathering.7 26.924.046.9 825.5 3.327.160.9 7. Of these.410.516.7 634.160.218.5 3.5 67.947.6 41.001.1 16.4 31.1 Note: * Figures not restated with reclassification made in FYE 2009. In FYE 2009.5 5.528.135.0 49. certain depositors which were previously classified under Deposits and placements of banks and other financial institutions were reclassified to Deposits from customers.4.7 32.5 9. a targeted 400 (342 installations completed) ATMs are placed at 7-Eleven stores to accord customers with 24-hour and more secure banking convenience.2 43.530.657.581.1 Customer Deposits The following table illustrates the profile of the AmBank Group’s customer deposits by type for the past three (3) FYEs 31 March 2007 to 2009 as well as the nine (9) months financial period ended 31 December 2009: Profile of Customer Deposits by Type FYE 31 March FYE 31 March 2007 * 2008 * (Audited) (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million RM million Deposit Type Demand deposits Savings deposits Fixed / Investment deposits Negotiable certificates of deposits Other deposits Total 2. .1 4.6 3.970.9 59.6 908. Customer deposits in the CASA space has increased by over 20% over the last 9 months.886.908.FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million 88.2 37.4 8.1 3.9 4.500. The Bank’s liquidity risk management is in compliance with the New Liquidity Framework as prescribed by BNM.164.340.299. 5.9 Total Liabilities and Equity Commitments and Contingencies Total Capitalisation RM million 62. The Group’s distribution footprint includes 189 commercial bank branches (with 2 dedicated Islamic bank branches).666.4 Funding The Bank funds most of its operations from customer deposits and interbank borrowings.

535.1 FYE 31 March 2008 (Audited) RM million FYE 31 March 2009 (Audited) RM million 5. and pays a fixed or floating rate of interest to Cagamas Berhad as selected by the Bank at the time of sale. 5.1 10.5 50.939. It also acts as a Principal Dealer on BNM money market tender operations. Asset securitization The Bank obtains alternative funding by undertaking asset securitization whereby it sells credit facilities or a portfolio of loans to a special purpose vehicle.8 7.4 63. to meet its longterm funding requirements and to facilitate the Bank in enhancing its liquidity risk management activities.3 2. .294. retaining the fixed or floating interest collected on the loans. the Bank is able to realize the value of the assets sold to the special purpose vehicle as well as diversify external sources of asset funding and to transfer specific risk exposures.4 41.135.The rest of this page has been left blank intentionally - .0 642.6 2. in turn issues securities to fund the acquisition from the Bank.069.4. By doing so.947.271. Apart from the abovementioned. The Bank seeks to maintain borrowings from the interbank market within manageable levels so as to avoid dependence on the interbank market for borrowings.8 7. The Bank continues to service such loans.9 807.3 Other Funding Sources Sale of credit facilities to Cagamas Berhad The Bank is able to secure longer-term sources of funds of three to seven years tenure by selling consumer loans to Cagamas Berhad (the Malaysian national mortgage corporation) with recourse to the Bank.9 31.7 37.268. The Bank also issues negotiable certificates of deposits and sells securities to raise short term funds.631. Interbank borrowings are normally used to fund short term mismatches in the Bank’s maturity profiles or for on-lending and arbitrage opportunities. where there are opportunities to do so.208.2 Interbank Deposits The Bank is an active interbank participant.0 858.The following table illustrates the maturity structure of the AmBank Group’s customer deposits for the past three (3) FYEs 31 March 2007 to 2009: Maturity Structure FYE 31 March 2007 (Audited) RM million Maturity Structure Due within six months Six months to one year One year to three years Three years to five years Total 26. The Bank is currently a net interbank lender. the establishment of the Senior Notes Issuance Programme will provide the Bank with a long term funding platform to tap liquidity in the Malaysian debt capital markets. which.4 1.802.65 - .4.824.

049.460.2 2.3 500. 5.6 959.8 400.66 - .0) 3.6 275.0 RM million Tier I Capital Paid-up share capital Irredeemable Non-Cumulative Convertible Preference Shares Innovative Tier I capital Non-innovative Tier I capital Share premium Statutory reserves Retained profits and other reserves Less: Deferred tax assets Total Tier I Capital Tier II Capital Irredeemable Convertible Unsecured Loan Stocks Innovative Tier 1 capital Subordinated term loans Medium term notes Subordinated bonds Exchangeable bonds General allowance for bad and doubtful debts and financing Total Tier II Capital Less: Excess Tier II capital 610.0 860.4 Contingency Funding Plan The contingency funding plan of AmBank comprises the following:liquidity and crisis management policy liquidity and management resources crisis management action plan The above are adopted in accordance with the Sound Practices for Managing Liquidity in Banking Organisation issued by the Basel Committee on Banking Supervision in 2000.4 3.3 6.6 - 3.8 1.0 942.5 Capital Adequacy The capital adequacy ratios of the AmBank Group are computed in accordance with BNM’s revised Risk-weighted Capital Adequacy Framework (RWCAF – Basel II).9 1.461. The AmBank Group has adopted the Standardised Approach for Credit Risk and Market Risk and the Basic Indicator Approach for Operational Risk.9 (306.8 927.7 633.4.6 2.9 750.4 150.665. The following table sets out the capital adequacy ratios of the AmBank Group for the past three (3) FYEs 31 March 2007 to 2009 as well as the nine (9) months financial period ended 31 December 2009.330.5 - .1) 3.0 775.0 RM million 670.557.0 575.470.0 414.220.1 548.3) 5.6 276.655.0 575.4 5.5.1 500.4 710. FYE 31 March 1 2007 (Audited) FYE 31 March 2 2008 (Audited) FYE 31 March 3 2009 (Audited) Third Quarter Ended 31 December 3 2009 (Unaudited) RM million 670.762.4 - RM million 610.4 (667.0 (596.8) 6.7 770.0 600.4 710.792.0 575.8 849.1 (827.620.0 942.0 983.6 4.394.6 201.0 713.2 1.0 400.6 460.763.1 291.9 2.0 600.4 150.4 (225.0) 2.9 - 3.109.252.4 150.589.8 460.0 895.971.2 1.

487.1 40.572.415.2 1. The following is a breakdown of the notional assets of the AmBank Group in the various categories of risk weights for the past three (3) FYEs 31 March 2007 to 2009: FYE 31 March 2007 (Audited) RM million 0% 10% 20% 35% 50% 75% 100% 150% Total risk weighted assets for credit risk Total risk weighted assets for market risk Total risk weighted assets for operational risk Large exposure risk requirement for equity holdings Total risk weighted assets 0.4 20.258.228.37% 14.878.3 54.9 673.034.5 FYE 31 March 2009 (Audited) RM million 1.154.1 1.433.973.812.827.135.4 25.631.5 3.187.226.2 9.08% 13.9 3.3 7.672.3 3.29% 6.049. Computed in accordance with BNM’s revised Risk-weighted Capital Adequacy Framework (Basel II) and included all subsidiaries within the Group.602.8) 10.740.5 .9 46.FYE 31 March 1 2007 (Audited) FYE 31 March 2 2008 (Audited) FYE 31 March 3 2009 (Audited) Third Quarter Ended 31 December 3 2009 (Unaudited) RM million 3.2 1.5 4.0 1.88% Notes: 1.089.3 9.0 25.0 46.892.752.2 1.833.67 - .8 13.752.9 14.The rest of this page has been left blank intentionally - .3 8.62% (32.770.953.8 RM million 3.096.2 2. 2.0 5.812.91% 10.066.792.7 4.2) 8.9 46.7 14.5 Maximum allowable Tier II capital Total Capital Funds Less: Investment in subsidiaries Other deductions Total Capital Base Core Capital Ratio Risk-weighted Capital Ratio RM million 2.9 61.996.8) (10. 3.395. Computed in accordance with Basel I capital accord.1 FYE 31 March 2008 (Audited) RM million 311.330.0 6.107.6 4.4 RM million 3. Computed in accordance with BNM’s revised Risk-weighted Capital Adequacy Framework (Basel II) and included only banking subsidiaries within the Group.1 4.384.2 10.0 1.09% (32.0 51.25% 14.

7 53.417.4 159.5 11.961.8) 51.587.876.8) 43.632.949.2 (365.0) 49.9 2.4) 59.4 (713.5 33.3 8.9 1.208.9) (1.574.3 159.4 1.861.739.0) 56.623. advances and financing Allowance for bad and doubtful debts and financing: .656.1 14.7 17.6 66.838.4 29.9 (2.1 RM million 1.2 2.854.3) (1.065.2 30.631.735.940.0 2.997.867.5 1.0 1. advances and financing RM million 1.6 (6.2 389.218.359.211.8) (1.368.5 47.4 1.3 9.5 (775.465.022.General .2 (905.9 1.5) 65.8) 58.6) (915.0 (6.The rest of this page has been left blank intentionally - .1 104.1 Loan Portfolio Loans.9 54.343.8 215.6.1 154.920.718.4 (7.4 11.8) 46.9 58.0 11.482.698.552.5.3 (6.831.074.5 19.806.4 373.1) 48.Specific Net loans.347.5 RM million 1.385.077.409.120.8 (983.195.9 28.821.8 2.9 73.3 11.7 Overdrafts Term loan facilities: Housing loans / financing Hire purchase receivables Other loans / financing Card receivables Bills receivables Trust receipts Claims on customers under acceptance credits Revolving credits Staff loans Factoring receivables * Total Less: Unearned interest and unearned income Less: Islamic financing sold to Cagamas Berhad Gross loans.6 Asset Quality 5.5 (1.550.314.9 3.570.235. advances and financing by type The following table sets out a breakdown of the AmBank Group’s loan portfolio by product type for the past three (3) FYEs 31 March 2007 to 2009 as well as the nine (9) months financial period ended 31 December 2009: FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million 1.984.7 4.139.739.5 326.2) 65.5 (895.7) 47.0 Note: * Included under Other term loans for FYEs 2007 to 2009 .5 30.956.8) 63.68 - .456.485.8 155.301.

7 1.127.261.0 1.7 3.435.016.015.620.1 3.1 2.7 11.0 1.7 RM million Purchase of securities Purchase of transport vehicles Purchase of landed property .424.4 FYE 31 March 2008 * (Audited) RM million FYE 31 March 2009 (Audited) RM million Note: * Not restated with change in presentation with effect from FYE 2009 .Loans.Non-residential Purchase of fixed assets other than land and building Personal use Credit card Purchase of consumer durables Construction Merger and acquisition Working capital Other purpose 495.3 10.5 1.0 10.369.8 1.112.4 58.682.7 46.2 51.120.336.736.550.8 346.1 1.619.763.997.3 6.786.207.844.467. advances and financing by economic purpose The following table sets out a breakdown of the AmBank Group’s gross loan portfolio by economic purpose for the past three (3) FYEs 31 March 2007 to 2009 as well as the nine (9) months financial period ended 31 December 2009: FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million 2.4 1.6 10.550.6 2.2 1.6 9.5 48.651.920.4 4.7 2.1 7.4 7.8) 58.456.0 2.878.4 15.310.9 1.956. advances and financing 5.662.2 (905. FYE 31 March 2007 * (Audited) RM million Loan Maturity Maturing within one year One year to three years Three years to five years Over five years Gross loans.3 25.69 - .6 49.3 2.267.347.0) 49.120.4 7.Residential . advances and financing 13.9 (2.757.6.7 59.301.949.2 9.125.726.030.9 2.313.5 (1.0 10.1 24.815.680.2 Loan Maturity Profile The following table sets out the breakdown of the AmBank Group’s gross loan portfolio by remaining maturity for the past three (3) FYEs 31 March 2007 to 2009.1 16.9 296.4 0.8 11.8) 46.0 1.876.718.3 3.5 9.356.391.4 1.5 RM million 1.291.3 2.406.2 8.147.9 3.126.1 22.206.351.306.4 24.6 1.6 328.777.1 RM million 640.631.248.021.137.7 65.920.031.7 1.550.6 5.4 Less: Islamic financing sold to Cagamas Berhad Gross loans.2 (365.5) 65.9 16.646.838.1 3.2 35.

Furthermore. Large loan exposure BNM’s guidelines set a large loan limit which prohibits a bank from granting a large loan (defined as an exposure that exceeds 15% of a bank’s capital funds) if the total of all large loans exceeds 50% of the bank’s total loans. as stipulated by BNM’s GP3 guidelines. As at 31 December 2009. 5.5% of gross loans net of interest-in-suspense and specific provisions. BNM requires Malaysian banks to keep a general allowance equal to at least 1.3 Concentration Limits Single customer limit BNM’s guidelines on single customer limits prohibit a bank from lending to any single customer or related group of customers an amount in excess of 25% of a bank’s capital funds (the sum of Tier 1 Capital and Tier 2 Capital).e. the outstanding balance of the loan net of interest-in-suspense and the realizable security value of any collateral. the AmBank Group has total loan loss reserves (specific and general combined) of RM2.6. i.70 - . An NPL that is more than twelve (12) months in arrears and is considered by the Bank to be impossible to collect or worthless will be classified as “bad”. the provisioning level will be 20% (in the case of substandard accounts).1 billion.5. 50% (in the case of doubtful accounts) or 100% (in the case of bad accounts).4 Non-Performing Loans (“NPLs”) Classification of NPLs BNM’s “GP3” guidelines classify NPLs into three categories according to periods of default. The Bank is in compliance with BNM’s guidelines on large loan limit. the AmBank Group seeks to limit its exposure to any one particular industry sector by the application of appropriate sector limits and benchmarks for industry sectors. . doubtful and bad.The rest of this page has been left blank intentionally - . An NPL will be classified as “doubtful” if it is more than nine (9) months in arrears and collection thereof is considered by the Bank to be highly improbable. Specific allowance is made against the uncollateralized portion of the outstanding balance of the loan.6. An NPL will be classified as “sub-standard” if it is between three (3) to nine (9) months in arrears and is considered by the Bank to represent a substantial and unreasonable degree of risk. that is. AmBank will consider a loan non-performing when it is more than three months in arrears. According to the classification status of each account. sub-standard.

718. Set out below are the AmBank Group’s total NPLs and NPL ratios for the past three (3) FYEs 31 March 2007 to 2009 as well as the nine (9) months financial period ended 31 December 2009: FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) *Third Quarter Ended 31 December 2009 (Unaudited) RM million 2.4 (396.940.811.9) (505. advances and financing Gross loans.2 billion and net NPLs were RM1.891.227.5 (1.5 (810.504.2 65.956.8 1.680.997.5 1.16% 3.4) (383.292.8 (1.419.0) 1.8) 1.631.7 19.6) (181.77% respectively.293.Profile of NPLs The AmBank Group’s gross NPLs were RM2.8) 64.120.920.831.8 (1.541.233.1 (1.4 65.3 6.195.38% and a ratio of net NPL to total net loans.273.7 365.0 RM million 4.7 Balance at beginning of year/ period Non-performing during the year/ period Reclassification to performing loans.876.077.7 891.8) 2.1 RM million 3.The rest of this page has been left blank intentionally - .8 48.8 59.006.9) (6.5) (53.419.9 1.7) 50.4 905.919.9) (1. advances and financing (before deduction of Islamic financing sold to Cagamas Berhad) of 3. advances and financing Amount recovered Debt equity conversion Amount written off Sale of NPLs Factored loans from related company Repurchase of loan Balance at end of year/ period Less: Specific allowance Net NPLs.149.2 (735. representing a ratio of gross NPL to total gross loans.9) 3.3) 196.0) (547.456.9) (447.7 (915.800.7 1.9) (1.5 (1.57% 2.550.2 (915.077.5 2.9 (1.1 2.8 58.77% .1 billion as at 31 December 2009.4) (0.5) 4.8) 46.7 46.0) 58.838.0 51.57% 1. advances and financing (including Islamic financing sold to Cagamas Berhad) NPLs ratio RM million 4.1 49.8 (577.898.0) (383.71 - . advances and financing Add: Islamic financing sold to Cagamas Berhad Balance at end of year/ period Less: Specific allowance Net loan.940. advances and financing (before deduction of Islamic financing sold to Cagamas Berhad) of 1.992.831.195.7) 1.165.1) 2.2) (761.

The determination of the realizable security value of collateral pledged is based on BNM’s “GP3” guidelines. Any amounts that the Bank realizes from property collateral relating to a loan for which the Bank has taken a loss provision following the provision will be added to the Bank’s income statement at the relevant time.0 44.6 27.0 450.419. BNM also requires all banks to keep a general loan loss allowance of at least 1.72 - .227.2 50.9 0.7 40. the provisioning level is 50% and for bad accounts.8 764. In addition.7 191.6 65.006.2 70.4 62.7 Loan loss provisioning policy AmBank’s provisioning policy is in line with BNM’s regulatory requirements.NPLs by economic purpose The table below sets out the AmBank Group’s NPLs by economic purpose for the past three (3) FYEs 31 March 2007 to 2009 as well as the nine (9) months financial period ended 31 December 2009: FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million 49.8 342.2 461.5 149. the amount of the Bank’s loan loss provisions will be contingent upon the amount of NPLs that are five to seven years in arrears and the amount of NPLs that are more than seven years in arrears. The Bank maintains both general provisions and specific provisions for NPLs.8 RM million 97.0 216.0 16. AmBank has internally adopted a practice of assigning zero value for property collaterals that relate to non-performing corporate and retail loans that are over seven years in arrears. for any financial period. the provisioning level is 100%.5 220.9 428.4 133.6 962.8 952.8 66. The loan loss provision assigned will vary depending on the status of the loan account. as a general rule: . where the write-back of specific provisions is permitted under certain circumstances.1 4.1 150.2 806.8 1.Non-residential Purchase of fixed assets other than land and building Personal use Credit card Purchase of consumer durables Construction Working capital Other purpose RM million 139.0 0. the outstanding balance of the loan net of interest-insuspense and the realizable security value of any collateral).3 300. in the case of doubtful accounts.7 2.5 Purchase of securities Purchase of transport vehicles Purchase of landed property . the provisioning level is 20%.4 19.1 3.2 0.8 RM million 60.5 93.5 924.e.372.6 2.4 19.1 453. The Bank’s policy in relation to the write-back of specific provisions is in line with BNM’s “GP3” guidelines. The realizable security value of the various forms of collateral pledged is ascertained in accordance with the Bank’s policy on valuation of collateral pledged for NPLs while the review of the adequacy of the specific provisions in the policy is carried out monthly. Specific loan loss provision will be made against the uncollateralized portion of the outstanding balance of a loan (i. a 50% provision is taken in respect of loan accounts that are more than five years but less than seven years in arrears.5 906. Thus.Residential .8 329.5 803.6 0. In the case of sub-standard accounts.4 44. for example.5% of total gross loans net of interest-in-suspense and specific provisions.1 30.3 166.831.

and the realizable security value for plant and machinery is based on the valuation report prepared by a professional valuer. the reserve price or the auction price of the property may be used as its realizable security value. Under certain circumstances. .73 - . in brief.the realizable security value for property is based on the forced sale value of the property. a 20% depreciation rate will be applied annually on the amount financed and no value is assigned for bad accounts. which. the realizable security value for quoted shares is based on the latest market price subject to BNM’s approval. net tangible value is used as the realizable security value. For quoted shares. In the absence of professional valuation. as stipulated in BNM’s “GP3” guidelines. provide that banks may write-off accounts or portions thereof which have been classified as bad and deemed uncollectible. The Bank writes off a particular loan after management has determined that the particular loan is not recoverable and (i) after either commencement of legal action to recover amounts unpaid or after the borrower has been declared bankrupt or (ii) if appropriate action has been taken to foreclose/ enforce on collateral securing the loan. if there is one. The following tables show the AmBank Group’s NPL classification standards and the specific provisioning required for different loan products: Overdrafts and loans (repayment at intervals of less than three months) Months in arrears (from first day of default) 4–8 9 – 11 > 12 Classification status Specific provisioning required Sub-standard Doubtful Bad 20% 50% 100% Loans (repayment at intervals of three months or longer) Months in arrears (from first day of default) 4–8 9 – 11 > 12 Classification status Specific provisioning required Sub-standard Doubtful Bad 20% 50% 100% Trade bills Months in arrears (from first day of default) 4–6 >6 Classification status Specific provisioning required Doubtful Bad 50% 100% Credit cards Months in arrears (from first day of default) 4–6 >6 Classification status Specific provisioning required Doubtful Bad 50% 100% Write-off policy AmBank’s write-off policy is in compliance with BNM’s “GP3” guidelines. The Bank observes BNM’s “GP3” guidelines for specific provisioning.

1 1.0 - 104.0 0.7 15.5 0.8 104.034.8 - 20.5 20.7 462.2 15. the amount of the loan is written down to the realizable value of the security and the shortfall in realizable security value over the outstanding balance of the loan will be written off.1 - 1.3 11.4 1.8 167.1 35. The Bank continues to evaluate effective procedures for improving recovery.771.6.387.1 1.3 1.117. As a general rule.5 Portfolio of Securities The securities held-for-trading.1 93.3 2.3 123. Write-offs of loans must be approved by the Board.9 41.6 4.1 . 5.5 232. a partial write-off is permitted when: the realizable value of the security is less than the outstanding balance of the loan and further collateral to improve the security deficiency is not forthcoming.6 25.2 5.The Bank continues to monitor loans which are written off for possible repayment of any amounts outstanding until all arrears are collected.419.74 - .7 681.7 347. The Bank also adopts BNM’s “GP3” guidelines for the partial write-off of accounts.3 34.9 39.2 43.2 177. securities available-for-sale and securities held-to-maturity of the AmBank Group for the past three (3) FYEs 31 March 2007 to 2009 as well as the nine (9) months financial period ended 31 December 2009 are as set out below: FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million RM million Securities held-for-trading At fair value Money market securities: Treasury bills Islamic treasury bills Malaysian Government securities Malaysian Government investment certificates Cagamas bonds Cagamas Mudharabah bearer bonds Islamic Khazanah bonds Negotiable instruments of deposit BNM monetary notes Quoted Securities: In Malaysia Shares Unit trust Warrants Unquoted Securities: In Malaysia Private debt securities Guaranteed private debt securities Outside Malaysia Private debt securities Total securities held-fortrading RM million RM million 214.0 - 999.3 - 14.0 1. Where there is adequate justification for the relevant Committee to approve a partial write-off of a loan. or the shortfall in realizable security value over the outstanding balance of the loan is deemed uncollectible and worthless.4 6.0 - 754.3 - 92.

5 97.5 3.7 493.5 1.877.0 631.578.0 76.3 818.9 76.598.0 29.7 4.1 - - - 7.3 568.7 119.75 - .9 71.2 36.FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million RM million Securities available-for-sale At fair value Money market securities: Islamic Khazanah bonds Negotiable instruments of deposit Negotiable Islamic debt securities Malaysian Government securities Malaysian Government investment certificates Quoted securities: In Malaysia Shares Unit trusts Shares / bonds with options and/or collateral Loan stocks Outside Malaysia Shares Unquoted securities: In Malaysia Private debt securities Guaranteed private debt securities Outside Malaysia Shares Private debt securities Total Less: Accumulated impairment losses Total securities available-forsale RM million RM million 400.4 119.0 287.788.6 - 17.2 (50.0 - - 36.1 70.7 Securities held-to-maturity At amortised cost Quoted securities: In Malaysia Shares Debt securities with options and/or collateral Debt securities Outside Malaysia Debt securities Unquoted securities: In Malaysia Shares Debt securities Debt securities with options and/or collateral 8.2 0.7 6.5 5.9 31.0 0.4 33.3 1.598.2 - 12.6 - 160.300.4 350.3 - 84.0 82.4 1.1 13.3 3.0 0.3 2.3 283.2 137.4 .1 418.7 598.9 67.7 598.9 84.4 92.5) 6.6 148.527.6 132.6 - 0.1 92.5 309.6 350.7 463.0 - 91.0 - 95.0 130.9 5.0 37.0 6.

accretion of discount and impairment as well as gain or loss arising from the derecognition of securities held-tomaturity are recognized in the income statement. the securities available-for-sale constituted 7. The securities held-to-maturity are measured at accreted/ amortised cost based on effective yield method less impairment losses. at which time the cumulative gain or loss previously recognized in equity will be transferred to the income statements. the securities held-for-trading constituted 2.462. The securities held-for-trading are stated at fair value and any gain or loss arising from a change in their fair values or the derecognition of securities held-for-trading are recognized in the income statements.8 922.6 1.9) 1.1) 656.5 (344. Securities available-for-sale Securities available-for-sale are financial assets that are not classified as held-for-trading or held-to-maturity.3 (373. As at 31 December 2009. The AmBank Group’s securities available-for-sale comprised mainly unquoted private debt securities.29% of the AmBank Group’s total assets.0) 753. collected.4 6.FYE 31 March 2007 (Audited) FYE 31 March 2008 (Audited) FYE 31 March 2009 (Audited) Third Quarter Ended 31 December 2009 (Unaudited) RM million RM million Outside Malaysia Private debt securities Total Less: Accumulated impairment losses Total securities held-tomaturity RM million RM million 1. quoted unit trusts and money market securities including negotiable instruments of deposits.34% of the AmBank Group’s total assets.4 Securities held-for-trading Securities are classified as held-for-trading if they are acquired principally for the purpose of benefiting from actual or expected short-term price movement or to lock in arbitrage profits.8 (345. Amortisation of premium. Securities held-to-maturity Securities held-to-maturity are financial assets with fixed or determinable payments and fixed maturity that the AmBank Group has the positive intent and ability to hold to maturity. . Any gain or loss arising from a change in fair value are recognized directly in equity through the statement of changes in equity. disposed of or impaired.4 (382. until the financial asset is sold. if any. Unquoted shares in organizations set up for socio-economic purposes and equity instruments received as a result of loan restructuring or loan conversion which do not have a quoted market price in an active market and whose fair value cannot be reliably measured are also classified as securities held-to-maturity.117.76 - .7 1.9) 548.135. Treasury bills and securities issued by the Malaysian Government and Cagamas and unquoted debt securities. The AmBank Group’s securities held-for-trading comprised mainly BNM monetary notes.001. As at 31 December 2009. The securities available-for-sale are measured at fair value or at amortised cost (less impairment losses) if the fair value cannot be reliably measured.

the securities held-to-maturity constituted 0.77 - . As at 31 December 2009.Any sale or reclassification of a significant amount of securities held-to-maturity not close to their maturity would result in the reclassification of all securities held-to-maturity to securities available-for-sale.62% of the AmBank Group’s total assets. .The rest of this page has been left blank intentionally - . The AmBank Group’s securities held-to-maturity comprised mainly unquoted and quoted debt securities. and prevent the AmBank Group from classifying the similar class of securities as securities held-to-maturity for the current and following two (2) financial years.

taking into consideration the Group’s internal capabilities and external factors. Exposure to credit risk arises from lending. repurchase or security-lending markets or credit facilities. whether due to factors specific to the Bank or to general market conditions.6. namely strategic. The Group’s goals correspond with the Group’s overall strategic planning to reflect the Group’s vision and mission. Liquidity could be affected by inability to access long term or short term deposits. people and systems or from external events on the Group’s day-to-day operations that are executed to attain its business objectives. lawsuits or adverse judgement which may lead to the incurrence of losses. unenforceability of contracts. operational and legal have been identified: Strategic Risk Strategic risk is the risk of not achieving the Group’s corporate strategic goals. credit spreads. Credit Risk Credit risk is the risk of loss due to the inability or unwillingness of a counterparty to meet its payment obligations. market. . credit. The AHB Group recognizes that every risk assumed by the AHB Group carries potential gains as well as possible erosion of shareholders’ value. seven (7) types of risks. Market Risk Market risk is defined as the potential loss arising from changes in interest rates. Legal and Regulatory Risk Legal risks arise from potential breaches of applicable laws and regulatory requirements. RISK MANAGEMENT AmBank’s risk management is performed on a group basis among its banking entities. The main objectives of the AHB Group’s risk management policies are to identify. policies and procedures to control them to ensure sustainable risk-taking and sufficient returns. capital. Funding Risk Funding risk is the risk that the Group will not be able to fund its day-to-day operations at a reasonable cost. capture. disruption or otherwise resulting in financial and reputation risks. equity prices and commodity prices. These changes can affect the value of financial instruments and may also affect customerflow-related revenues and proprietary trading revenues. and analyze these risks at an early stage. Operational Risk Operational risk is the risk arising from inadequate or failed internal processes. Capital Risk Capital risk is the failure to comply with the requirements of BNM in attaining sufficient capital to support the business risks of the Bank. as well as continuously measure and monitor these risks and to set limits.The rest of this page has been left blank intentionally - . funding. securities and derivative exposures.78 - . foreign exchange rates. To this end. which restrict or prevent such objectives from being achieved.

and oversees the executive body by having a more focused forum on risk issues. The Risk Management Committee of Directors ensures that risk management at all levels are carried out effectively and that the Board’s risk tolerance levels are effectively enforced by the Bank. It will review high-level risk exposures and decisions made by the Executive Risk Management Committees. The Board also plays the important role of establishing and approving the broad risk tolerance levels for the Bank. the engagement of new products or activities would require the Board’s approval after taking into account our risk-bearing capacity and readiness. .Risk Management Structure The Group’s main risk management organizational structure (as illustrated below) is made up of the following components: Board Risk Management Committee of Directors Executive Risk Management Committees Risk Management Department Figure 1: Risk management structure Board Risk Management Committee of Directors Group Managing Director Executive Risk Management Committees Portfolio Management& Credit Policy Committee Group Operational & Legal Risk Committee Group Traded Market Risk Committee Group Assets & Liabilities Committee Islamic Assets & Liabilities Committee Risk Management Department Board The Board regularly discusses risk management policies and approves the Bank’s risk management strategy. In addition. Risk Management Committee of Directors The Risk Management Committee of Directors comprises non-executive directors and assists the Board in discharging its functions.79 - . to ensure that these decisions are within the Bank’s overall risk parameters.

The Internal Audit Department and Audit Committee complement the risk management structure. monitoring of compliance with limits. These Committees report their activities to the Risk Management Committee of Directors on a quarterly basis. It assists the Executive Risk Management Committees in discharging their duties and implementing the directives of the committees. control systems and methodologies used to manage risks. Their functions encompass research and analysis.Executive Risk Management Committees The Bank’s Executive Risk Management Committees are responsible for the day-to-day management of risks and for implementing the Board’s approved risk management policies at the operational level. reporting on risk exposures. and Recommends means to control or minimise risks on a portfolio basis.The rest of this page has been left blank intentionally - . within the parameters set by the Board. Acts as a central resource for evaluating risks to assist management. to provide a comprehensive coverage of all risks within the Bank. these Committees are vested with the power to steer the Bank’s business direction in conformance to the risk tolerance levels set by the Board. Risk Management Department The Risk Management Department is independent of business units and reports directly to the Group Managing Director. business and operating units. The major role of the Risk Management Department is to: Be a central platform where risks throughout the Bank can be aggregated for overview on a portfolio basis. Standardise risk measurement methodology to enable comparisons. The Risk Management Department is made up of several units. Chaired by senior executives and comprising the relevant senior executives of both the business and non-business units.80 - . . formulation of risk assessment methodology and formulation of the Bank’s risk strategy. They assist the Board by providing independent assessments of the effectiveness of the risk management structure. These Committees review the external business and economic environments and have discretionary powers in the micro-management of risk and the risk positioning of the Bank’s business.

6%). This will be underpinned by the objective of promoting Malaysia’s socio-economic development as well as the need to preserve financial soundness and stability.0% in 2008. Pre-tax profits of the banking system declined 25. Malaysia) .6%) and construction (RM3. Over the years.7 billion.9 billion) due to higher recoveries and reclassification to performing loans.81 - . which was released in 2001. resilient and more divesified. 9.2 Prospects for 2010 Monetary policy remains supportive The Malaysian economy is expected to improve in 2010 with growth of 2. (Source: Economic Report 2009/2010.0% – 3. households accounted for RM15.3 billion).1 billion as at end-July 2009 (end-2008: RM15.7%. As for NPLs of commercial banks.7%).7. Private sector financing through the banking system and capital market is expected to increase as economic growth gathers momentum. The strengthened financial sector is well-positioned to contribute meaningfully to the economy. FSMP draws to a close… The financial sector has undergone significant transformation since the Asian financial crisis and has emerged stronger. The Financial Sector Masterplan (FSMP). attributed to a one-off provisioning adjustment by a large banking institution in accordance with its financial year end. supported by stronger domestic demand and fiscal measures as well as the recovery in the global economy. 10. and their implications on economic growth and price stability. (Source: Economic Report 2009/2010. a level comparable to developed countries.1 INDUSTRY OVERVIEW Financial Sector Developments Banking system remains strong… The banking system remains resilient and sound with strong capitalisation and sustained asset quality. Monetary policy will remain supportive of growth and will continue to be determined based on the assessment of domestic and international developments. cross-selling of bancassurance and wealth management services as well as treasury activities remained stable. Ministry of Finance. The risk-weighted capital ratio (RWCR) and core capital ratio (CCR) improved to 14. 7.0%.6%.1 billion. Given the global and domestic forces of change that present significant opportunities for the Malaysian financial sector and with the FSMP reaching a close in 2010. The blueprint aims to enhance the role of the financial sector as an enabler. Overall core income sources from financing activities. catalyst and driver of economic growth. respectively as at end-July 2009 (end-2008: 12. Inflation is anticipated to rise modestly in line with the increase in global commodity prices.6% of total gross NPLs as at end-June 2009. the contribution of the financial sector to Gross Domestic Product (GDP) has grown from 9. Liberalisation measures for the financial sector will enhance the attractiveness and competitiveness of the Malaysian financial and capital markets.1% to RM15.3%.4 billion in the first seven months of 2009 (January – July 2008: 17.1% as at end-July 2009 after holding steady at 2.3% and 12. The 3-month net NPLs ratio further improved to 2. followed by manufacturing (RM5.2% since December 2008. a proposed private pension scheme will enable more savings to be intermediated through the capital market and provide an additional retirement savings scheme. RM11. Malaysia) 7. 17. BNM is now in the midst of formulating a new blueprint to position the financial sector to support and contribute meaningfully to Malaysia’s economic transformation process. Ministry of Finance. The asset quality of the banking system was sustained with net non-performing loans (NPLs) declining 5. charted the transformation process that has been undertaken in terms of capacity buidling and reforms in the regulatory and institutional frameworks.4% to RM8. Meanwhile.8 billion or 48.2% in 2000 to 11.

(ii) Further. and/or if not accounted for as alluded to in the preceding sub-paragraph (i). and our Board is not aware of any threatened proceedings against AmBank or our principal subsidiary company that are likely to have a material adverse effect on the AmBank Group’s financial position or business. claims and arbitration. and Business Transfer Agreement dated 11 March 2008 (as supplemented by the supplemental agreement dated 27 March 2008) between AmIslamic Bank and AmInvestment Bank in respect of the scheme for the transfer of the assets and liabilities (and all rights and interests relating or attaching thereto) relating to the Islamic treasury. 8.8.82 - . claims and arbitration either as plaintiff or defendant. claims and arbitration arising from the ordinary course of business apart from those which: (i) the financial impact thereof has already been accounted for in the last audited financial statements of AmBank and/or our principal subsidiary company. there are no other material contracts (including contracts not reduced into writing).2 Material Litigation As at 11 December 2009: (a) in respect of material litigation. claims and arbitration arising from the ordinary course of business that is likely to have a material adverse effect on our or our principal subsidiary’s financial position or business. investment and credit/ lending activities or business carried out by AmInvestment Bank to AmBank (excluding such assets and liabilites as listed in the Business Transfer Agreement).1 OTHER INFORMATION Material Contracts Save as disclosed below. as determined in the manner as set out therein. for a consideration equivalent to the total book value of the assets acquired less the total book value of the liabilities to be assumed. not being contracts entered into in the ordinary course of business which have been entered into by the AmBank Group during the past two (2) years preceding the date of this IM: (a) Business Transfer Agreement dated 11 March 2008 (as supplemented by the supplemental agreement dated 27 March 2008) between AmBank and AmInvestment Bank in respect of the scheme for the transfer of assets and liabilities (and all rights and interests relating or attaching thereto) relating to the conventional treasury. our Board is of the view that there is no material and adverse impact on the financial position of AmBank or our principal subsidiary company arising from such litigation. (b) 8. (ii) . investment and credit/ lending activities or business carried out by AmInvestment Bank to AmIslamic Bank (excluding such assets and liabilities as listed in the Business Transfer Agreement). claims and arbitration arising not in the ordinary course of business: (i) neither AmBank nor our principal subsidiary company is engaged in any material litigation. our Board does not know of any threatened proceedings against us and/or any of our principal subsidiary company in respect of litigation. for a consideration equivalent to the total book value of the assets acquired less the total book value of the liabilities to be assumed. and (b) in respect of litigation. as determined in the manner as set out therein.

007.767 15.144 13.less than one year .224 Contingent Liabilities Direct credit substitutes Short-term self liquidating trade-related contingencies Obligations under underwriting agreements Islamic financing sold to Cagamas Berhad with recourse Unpaid portion of partly paid shares Certain transaction-related contingent items Others 2.497 60.360. the AmBank Group makes various commitments and incurs certain contingent liabilities with legal recourse to its customers.428 59.655 - 321.005 706.maturing more than one year to less than five years .508 33.201 348.723 1.039 5.207.594 31.maturing more than one year to less than five years Cross currency swap: .081 1.more than one year Unutilised credit card lines Forward purchase commitments .152.154.183 551.992.940.444 263.137 511.560 4.310 1.082 3.604 4.490 79.791 23.031.994.492 110.318 358.298 21.179. No material losses are anticipated as a result of these transactions.259 903.310 1.maturing more than five years Foreign exchange related contracts: .391 288.897 13.373 261.610 630.83 - .162 20. The commitments and contingencies outstanding of the AmBank Group as at 31 December 2009 are as follows: Principal Amount (RM’000) Derivative Financial Instruments Interest rate swap contracts: .800 2.730 8.787 680.541 550 3.515.893 178.914 .162 3.698 24.018 - 10.605 150 1.188 150 865.less than one year Interest rate futures: .493.700 2.maturing more than one year to less than five years Options equity Options commodity Commitments Irrevocable commitments to extend credit maturing : .maturing within one year .605 150 882.709.less than one year Sell and buy back agreements Credit Equivalent Amount (RM’000) Risk Weighted Amount (RM’000) 4.maturing within one year .000 348.278 11.019.208 455.660 110.8.000 100.322 675.within one year .900 2.099.280 196.362.000 22. The commitments and contingencies are not secured against the AmBank Group’s assets.162.657.630 2.3 Commitments and Contingent Liabilities In the normal course of business.406 25.841 10.330.146 385.250 3.683 1.756.564.064.446 42.516 6.068 3.000 21.

84 - . the AmBank Group has the following capital commitments: Amount (RM’000) Authorised and contracted for : Purchase of computer equipment and software Leasehold improvements 30.298 Authorised but not contracted for: Purchase of computer equipment and software 54.140 32.885 87.The rest of this page has been left blank intentionally - .As at 31 March 2009.158 2.183 .

APPENDIX I AUDITED FINANCIAL STATEMENTS FOR THE FINANCIAL PERIOD 1 APRIL 2008 TO 31 MARCH 2009 .

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8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies CONTENTS PAGE(S) Directors' Report Statement by Directors Statutory Declaration Report of the Auditors Balance Sheets Income Statements Statement of Changes in Equity Cash Flow Statements Notes to the Financial Statements 1-12 13 14 15-16 17-18 19 20-23 24-28 29-133 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .Company No.

(2) On 9 April 2008. The transfer of the Fund-Based Activities was in relation to a group restructuring exercise approved by the Minister of Finance as announced by AMMB Holdings Berhad ("AHB"). Todate.432 billion for the Bank and the Group respectively.46 billion MTN under the RM2. 26 September 2008 and 1 March 2009. the Bank issued the Sixth Tranche of Medium Term Notes ("MTN") amounting to RM600 million. the Group's ultimate holding company. The proceeds raised was utilised for the refinancing of existing subordinated debts and general working capital requirements.117 billion and RM1. The transfer of the Fund-Based Activities was effected on 12 April 2008.0 billion nominal value MTN Programme. 1989 by way of vesting orders obtained from High Courts. a licensed off-shore bank. There have been no significant changes in the nature of the activities of the Bank and its subsidiaries during the financial year. PRINCIPAL ACTIVITIES The principal activity of the Bank is to carry on the business of a licensed commercial bank which also includes the provision of Islamic banking services via its wholly owned subsidiary AmIslamic Bank Berhad ("AmIslamic Bank"). The principal activities of its subsidiaries are disclosed in Note 14 to the financial statements. The transfer of the Fund-Based Activities was effected pursuant to Section 50 of the Banking and Financial Institutions Act. treasury and credit/lending activities or businesses ("the Fund-Based Activities") of AmInvestment to the Group. on 11 March 2008 to Bursa Malaysia Securities Berhad. the Bank has issued a total of RM1. 8515–D AmBank (M) Berhad And Its Subsidiary Companies (Incorporated in Malaysia) DIRECTORS' REPORT The directors have pleasure in presenting their report and the audited financial statements of the Group and of the Bank for the financial year ended 31 March 2009.Company No. SIGNIFICANT EVENTS (1) The Group and AmInvestment Bank Berhad ("AmInvestment") had on 11 March 2008 entered into a Business Transfer agreement for the transfer of assets and liabilities relating to the investment. The total purchase consideration for all the net assets transferred amounted to RM1. The assets transferred included AmInvestment's 100% shareholding in AmInternational (L) Ltd. 1 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . to the Bank.

457) 701.785 701.170 505. AmBank had established a wholly-owned subsidiary under the name of AmMortgage One Berhad ("AmMortgage"). The gross proceeds raised from the RM NIT1 Programme will be applied towards funding the growth of the Bank’s business operations.785 505.032) (309.) (3) The Bank has successfully completed the RM500 million RM NIT1 Programme. The RM NIT1 issuance is structured in accordance with the Risk-Weighted Capital Adequacy Framework (General Requirements and Capital Components) issued by Bank Negara Malaysia (“BNM”).000.011. a newly incorporated wholly-owned subsidiary company of the Bank which are stapled together with the NCPCS. and Subordinated Notes ("SubNotes") issued by AmPremier Capital Berhad ("AmPremier"). as part of its capital management initiatives to support and strengthen its capital position whereby the first tranche of RM200 million was issued on 27 February 2009 whilst the remaining RM300 million was issued on 6 March 2009. FINANCIAL RESULTS The Group RM'000 Profit before zakat and taxation Zakat Taxation Profit for the year Attributable to: Equity holders of the Bank Minority interests Profit for the year 1.659 (1. AmMortgage has an authorised share capital of RM100. BNM and Securities Commission had.170 The Bank RM'000 759.409) 505. to undertake the business of securitization of mortgage loans.194 (253. approved the RM NIT1 Programme.000 and an issued and paid-up share capital of RM1. The stapled NCPCS and the SubNotes together constitute the “Stapled Capital Securities”. The RM NIT1 comprises the Non Cumulative Perpetual Capital Securities ("NCPCS") issued by the Bank. via their letters dated 23 December 2008 and 6 January 2009 respectively. The NCPCS and SubNotes cannot be traded separately until the occurrence of certain Assignment Events. 8515–D SIGNIFICANT EVENTS (CONTD.Company No.785 2 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .183 (13) 701. The Stapled Capital Securities are rated A3 by RAM Rating Services Berhad. (4) Upon BNM's approval dated 19 February 2009.

fast moving consumer goods. Lending growth is expected to slow down. Action plans are in place to conserve existing customer relationships and cautiously acquire new businesses. key priorities for the AHB Group for the coming financial year will be to preserve its strong capital position. AHB and its subsidiaries ("AHB Group") will continue to target for profitable growth and dynamic rebalancing. distribution footprints will continue to be expanded. todate. with slow recovery commencing sometime after the next financial year. albeit at a moderated pace. and diversifying away from concentrations and re-positioning the business for differentiated growth. Revolving Credit-i and Islamic structured deposits called Active Commodities Islamic Negotiable Instrument of Deposit. customers and employees. impacted different countries to varying degrees. Activation focus on payroll crediting. 3 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . new products were launched which include Islamic Floor Stocking-i. AHB Group remains committed in delivering value to its shareholders. and new products and services. broad property sector and contract financing. Islamic Repos. oil and gas. with non-performing loans increasing.Company No. and Anti-attrition focus to prevent dormancy. 8515–D BUSINESS PLAN AND STRATEGY The current global economic and financial underway has. The domestic banking industry has remained substantially intact with no major stresses on capital positions. Navigating through the more difficult environment will also require closely monitoring customer positions and restructuring of accounts. Growing customer deposits and increasing the mix of low cost deposits are key planks for the retail and business banking arms. albeit from its current historical lows. retail banking aims to sustain growth via focusing on higher return businesses and superior customer service. the Bank's wholly owned Islamic banking subsidiary has shown remarkable growth by capitalising on the robust demand for Islamic financial services. AmIslamic Bank. Despite the tougher operating landscape. This will enable the AHB Group to stay resilient and build on the headstart advantage that it has had since early 2008. small businesses. AmIslamic Bank had forged tie-ups and alliances with companies whereby its Al-Taslif card members were introduced with easy payment plans and Takaful Investment-linked plans for its customers to invest in specific Islamic deposits. cash management and transactional services. geared towards diversification of assets. Since its inception. and supported by enhanced risk management disciplines and operating efficiency. In the retail banking segment. In the retail and business banking areas. The easing of monetary policies by Bank Negara Malaysia ("BNM") and countercyclical fiscal measures introduced by the government are expected to both minimise contraction and build longer-term capacity of the domestic economy. Business banking segment has achieved good growth in its credit facilities over the previous three years. Lending growth will be modest. In addition. and emerging and mass affluent segments. AHB Group will stay disciplined in executing to its strategic agenda around de-risking. the AHB Group continues to consolidate its position as the fourth largest by retail assets size. the Malaysian banking system has learnt valuable lessons from the previous financial crisis in 1998 – 2000. Initiatives to harness savings and current accounts centre on three key pillars: (i) Acquisition focus on transact and save needs of the mass market. enhance risk management and streamlining operations for improved productivity and cost efficiency. In view of the weakening outlook. Sustaining portfolio profitability will require realigning lending to more stable economic segments including agriculture. medical. The Malaysian economy is expected to feel the full impact of the downturn in 2009. Nonetheless. (ii) (ii) In order to support deposits and fee growth.

diversifying away from concentrations and differentiated growth via targeting profitable business segments. the results of the operations of the Group and of the Bank during the financial year have not been substantially affected by any item.762 ordinary shares of RM1. and providing working capital schemes and financial guarantees for credit enhancement. transaction or event of a material and unusual nature likely. DIVIDENDS No dividend on ordinary shares has been paid or declared by the Bank since the end of the previous financial year. Unemployment rate is forecasted to rise to circa 5%. progressively expanding distribution footprints. Further easing of monetory policies may materialize to boost economic activity. transaction or event of a material and unusual nature. and introducing superior products and services. The AHB Group’s strategic partnership with ANZ and internal business restructuring will continue to underpin its ability to deliver profitable growth over the medium term. the issued and fully paid-up ordinary share capital of the Bank increased to 670. The new ordinary shares issued during the financial year rank pari passu in all respects with the existing shares of the Bank. as it is focused on reducing unemployment. 4 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . RESERVES AND ALLOWANCES There were no material transfers to or from reserves. our current view is that any rebound can be expected only towards late 2010. allowances or provisions during the financial year other than those disclosed in the financial statements. Over the past two years.000. 8515–D OUTLOOK FOR NEXT FINANCIAL YEAR Global financial turmoil continues to worsen with economic contraction in developed nations and the knock-on effects on the Malaysian economy have begun to precipitate since end 2008. The AHB Group will also continue to focus on building its brand name. in the opinion of the directors. There were no issuance of debentures during the financial year.363. The AHB Group will stay focused on executing its strategies built around de-risking.00 each. The ICULS was converted to new shares in the Bank and credited as fully paid on the basis of one new share for every Ringgit Malaysia Five (RM5. The Second Stimulus Package (of RM60 billion announced by the Federal Government on 10 March 2009) will provide some cushion against increasing NPL’s. growing deposits including lowcost deposits.00 each.Company No. With the conversion of ICULS. the AHB Group has also taken steps to strengthen its capital and balance sheet positions. At present. to affect substantially the results of the operations of the Group and of the Bank for the current financial year in which this report is made. The banking system will face slower credit demand in most segments and deteriorating asset quality as compared to 2008. investment banking and markets. the holding company. The AHB Group is well positioned to weather short term global.000 fully paid ordinary shares of RM1.00) nominal amount of ICULS tendered. ISSUANCE OF SHARES AND DEBENTURES On 20 May 2008. AMFB Holdings Berhad exercised its conversion right to convert the entire RM300 million Irredeemable Convertible Unsecured Loan Stocks ("ICULS") into 60.183. The contraction in external sector can only be partly offset by moderate growth in domestic demand. Most analysts and economists have projected a broad economic downturn for 2009 and negative GDP growth of at least -2% for Malaysia. The resultant share premium arising from conversion amounting to RM232. ITEMS OF AN UNUSUAL NATURE In the opinion of the directors. Enhanced credit control. and insurance. There has not arisen in the interval between the end of the financial year and the date of this report any item. Whilst the pace of economic contraction may slow down later this year. and collections and recoveries management will receive heightened focus areas in the coming year. The directors do not recommend the payment of any dividend on ordinary shares in respect of the current financial year. the financial system's NPL’s is at its lowest since the Asian financial crisis period in 1998-1999. regional and national volatilities with its diversified business portfolio across retail and business banking.993 was credited to the Share Premium account. new risk scorecards and methodologies.

5 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . or the amount of the allowance for doubtful debts and financing. VALUATION METHODS At the date of this report. the directors are not aware of any circumstances. will or may substantially affect the ability of the Group and of the Bank to meet their obligations as and when they fall due.Company No. or is likely to become enforceable within the period of twelve months after the end of the financial year which. 8515–D SHARE OPTIONS No options have been granted by the Bank to any parties during the financial year to take up unissued shares of the Bank. CHANGE OF CIRCUMSTANCES At the date of this report. CONTINGENT AND OTHER LIABILITIES At the date of this report. in the financial statements of the Group and of the Bank inadequate to any substantial extent. the directors are not aware of any circumstances which have arisen which render adherence to the existing methods of valuation of assets or liabilities of the Group and of the Bank misleading or inappropriate. BAD AND DOUBTFUL DEBTS AND FINANCING Before the income statements and balance sheets of the Group and of the Bank were made out. No shares have been issued during the financial year by virtue of the exercise of any option to take up unissued shares of the Bank. there does not exist: (a) any charge on the assets of the Group and of the Bank which has arisen since the end of the financial year which secures the liability of any other person. the directors are not aware of any circumstances which would render the amount written off for bad debts and financing. No contingent or other liability of the Group and of the Bank has become enforceable. in the opinion of the directors. As at the end of the financial year. At the date of this report. or (b) any contingent liability in respect of the Group and of the Bank that has arisen since the end of the financial year. and have satisfied themselves that all known bad debts and financing had been written off and adequate allowances had been made for doubtful debts and financing. there were no unissued shares of the Bank under options. not otherwise dealt with in this report or the financial statements of the Group and of the Bank that would render any amount stated in the financial statements misleading. the directors took reasonable steps to ascertain that action had been taken in relation to the writing off of bad debts and financing and the making of allowances for doubtful debts and financing. other than those incurred in the normal course of business.

000 Shares Bought - Sold - Balance at 31.2008/Date of Appointment 25. 8515–D CURRENT ASSETS Before the income statements and balance sheets of the Group and of the Bank were made out.800 100. The interests in shares in the ultimate holding company of those who were directors at the end of the financial year as recorded in the Register of Directors’ Shareholdings kept by the Bank under Section 134 of the Companies Act.2008) Anthony John Healy (resigned on 31. Tan Sri Dato' Azman Hashim. retire at the forthcoming Annual General Meeting and offer themselves for reappointment to hold office until the conclusion of the next Annual General Meeting.2008) In accordance with (appointed the Bank’s Articles of Association.2009 25.11. of ordinary shares of RM1. Mr Ashok Ramamurthy. retires at the forthcoming Anthony John HealyArticle 95 ofon 01.000 Tan Kheng Soon Cheah Tek Kuang Ashok Ramamurthy 6 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . offers himself for re-election. AMMB Holdings Berhad No. being eligible. the directors took reasonable steps to ascertain that any current assets.2007) Annual General Meeting and.00 each Balance at 1.4.800 100.000 78. their values as shown in the accounting records of the Group and of the Bank have been written down to their estimated realisable values.10.10. Tun Mohammed Hanif Omar and Mr Tan Kheng Soon. DIRECTORS' INTERESTS Under the Bank's Articles of Association. 1965. Pursuant to Section 129 of the Companies Act. are as follows: DIRECT INTERESTS In the ultimate holding company.000 78. the directors are not required to hold shares in the Bank. DIRECTORS The directors of the Bank who served on the Board since the date of the last report and at the date of this report are: Tan Sri Dato' Azman Hashim Tun Mohammed Hanif Omar Tan Sri Datuk Clifford Francis Herbert Dato' Gan Nyap Liou @ Gan Nyap Liow Tan Kheng Soon Cheah Tek Kuang Ashok Ramamurthy (appointed on 18. the directors are not aware of any circumstances.3. At the date of this report. which were unlikely to be realised in the ordinary course of business. which would render the values attributed to the current assets in the financial statements of the Group and of the Bank misleading. 1965. other than debts and financing.Company No.

4. finance. and establishes guidelines for overall business. he is deemed to have interests in the shares of the Bank and its related corporations. organization structure. other than for the related party transactions as shown in Note 42 to the financial statements. None of the other directors in office at the end of the financial year had any interest in shares in the Bank or its related corporations during the financial year. AMMB Holdings Berhad No. The Board currently comprises seven (7) directors with wide skills and experience. There is a clear division between the roles of Chairman and the Chief Executive Officer of the Bank. The Senior Management team of the Bank are invited to attend Board Meetings to provide presentations and detailed explanations on matters that have been tabled. DIRECTORS’ BENEFITS Since the end of the previous financial year.001. The Company Secretary has been empowered by the Board to assist the Board in matters of governance and in complying with statutory duties. the Bank or any other body corporate. four (4) of whom are Independent Non-Executive Directors.3. The Board meets monthly to carry out its duties and responsibilities. with additional Board meetings being convened.151. The Independent Non-Executive Directors ensure strategies proposed by the management are fully discussed and examined. to the extent the ultimate holding company has an interest.2009 Shares Tan Sri Dato’ Azman Hashim Bought Sold 480. AMMB Holdings Berhad. risk and control policies. 8515–D DEEMED INTEREST In the ultimate holding company.Company No. no director of the Bank has received or become entitled to receive a benefit (other than benefits included in the aggregate amount of emoluments received or due and receivable by directors as shown in Note 43 to the financial statements) by reason of a contract made by the Bank or a related corporation with the director or with a firm in which the director is a member. or debentures of. did there subsist any arrangements to which the Bank is a party to any arrangements whose object is to enable the directors to acquire benefits by means of the acquisition of shares in. AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 7 .000 - 482. policies and affairs with the goal of enhancing shareholder's value.333 By virtue of Tan Sri Dato Azman Hashim's shareholding in the ultimate holding company.850. or with a company in which the director has a substantial financial interest.333 1. The Board supervises the management of the Bank’s businesses. whenever required. The Board addresses key matters concerning strategy. The Board complies with the best practices in corporate governance as set out in the Malaysian Code on Corporate Governance. The Directors participate fully in decision making on key issues regarding the Bank and its subsidiaries. CORPORATE GOVERNANCE (a) Board Responsibility and Oversight The Board of Directors (the “Board”) remains fully committed in ensuring that the principles and best practices in corporate governance are applied consistently in the Bank and its subsidiaries. capital allocation and approves all key business developments.00 each Name of Company AmcorpGroup Berhad Balance at 1.2008 Balance at 31. Neither during nor at the end of the financial year. as well as taking into account the long term interests of various stakeholders. business developments (subject to matters reserved for shareholders’ meetings by law). of ordinary shares of RM1.

The minutes of the Committee meetings are tabled at the subsequent Board meetings for comment and notation.Company No. * Appointed on 18. The attendance of Board members at the meetings of the Board and the various Board Committees is set out below:- Number of meetings attended in Financial Year 2009 ("FY2009") Audit and Examination Committee N/A 10 10 (Chairman) 8 Risk Management Committee N/A N/A 7 (Chairman) 6 Board of Directors Tan Sri Dato' Azman Hashim Tun Mohammed Hanif Omar Tan Sri Datuk Clifford Francis Herbert Dato' Gan Nyap Liou @ Gan Nyap Liow Tan Kheng Soon Cheah Tek Kuang Ashok Ramamurthy* Anthony John Healy** Number of meetings held in FY2009 12 (Chairman) 12 12 Nomination Committee 1 1 (Chairman) 1 Remuneration Committee 3 3 (Chairman) 3 10 N/A N/A 12 12 5 6 12 1 1 N/A 1 1 N/A N/A N/A 2 3 N/A N/A N/A 5 10 7 N/A N/A N/A 7 Notes: 1. 2. Nomination Committee * Remuneration Committee * Audit and Examination Committee Risk Management Committee *Dissolved on 23 July 2008 with the establishment of Group Nomination Committee and Group Remuneration Committee at Group level (AMMB Holdings Berhad).10. which have been approved by the Board. are: 1. N/A represents non-committee member 3. 2.2008 ** Resigned on 31.2008 8 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .) (b) Committees of the Board The Board delegates certain responsibilities to the Board Committees.11. All attendances reflect the number of meetings attended during Directors’ duration of service. 4. which were created to assist the Board in certain areas of deliberations. 3. 8515–D CORPORATE GOVERNANCE (CONTD. The roles and responsibilities of each Committee are set out under the respective terms of reference. The Committees.

the mix of skills and experience and other qualities and competencies that Non-Executive Directors should bring to the Board. all of whom are Non-Executive Directors. It also recommended the appointment of Directors to the Board and Committees of the Board as well as the annual review of the performance of the Board. The financial statements were reviewed by the AEC prior to their submission to the Board of the Bank for adoption. The Committee was dissolved on 23 July 2008 following the establishment of Group Remuneration Committee ("GRC") on even date at AMMB Holdings Berhad. reviewed related party transactions. Committees of the Board and of individual Directors. The Committee was dissolved on 23 July 2008 following the establishment of Group Nomination Committee ("GNC") on even date at AMMB Holdings Berhad. seek approval for related party transactions and. Audit and Examination Committee The Committee comprises three (3) members. the AEC has reviewed the procedures set up by the Bank to identify and report. with the assistance of the internal auditors. The Committee was responsible for determining and recommending to the Board the framework or broad policy for the remuneration of the Directors. the results arising thereafter as well as their evaluation of the system of internal controls. In addition. the Bank's ultimate holding company. the Chief Executive Officer and other Senior Management staff. Remuneration Committee The Committee comprised four (4) members.) Nomination Committee The Committee comprised six (6) members. statutory auditors as well as the regulatory authorities in the examination reports. the Bank's ultimate holding company. 9 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .Company No. as well as making recommendation to the Board with regard to any changes that are deemed necessary. and the functions of the Committee were taken over by the GNC. It was responsible for regularly reviewing the board structure. three (3) of whom are Independent Non-Executive Directors. The Board has appointed the Audit and Examination Committee (“AEC”) to assist in discharging its duties of maintaining a sound system of internal control to safeguard the Bank’s assets and shareholder’s investments. The AEC met during the year to review the scope of work of both the internal audit function and the statutory auditors. 8515–D CORPORATE GOVERNANCE (CONTD. The AEC also followed up on the resolution of major issues raised by the internal auditors. and the functions of the Committee were taken over by the GRC. size and composition. and where necessary. all of whom are Independent Non-Executive Directors.

compliance monitoring. strategies and procedures within the Bank. The minutes of the AEC meetings are formally tabled to the Board for notation and action. The Risk Management Committee exercises oversight on behalf of the Board to ensure adequate overall management of credit. The Risk Management Department is independent of the various business units and acts as the catalyst for the development and maintenance of comprehensive and sound risk management policies. It also assesses the Bank’s ability to accommodate risks under normal and stress scenarios. The Committee ensures that the Board’s risk tolerance level is effectively enforced. Group Internal Audit focuses its efforts on performing audits in accordance with the audit plan. market. 8515–D CORPORATE GOVERNANCE (CONTD. The structured risk assessment approach ensures that all risk-rated areas are kept in view to ensure appropriate audit coverage and audit frequency. data centres and network security. which is prioritised based on a comprehensive risk assessment of all significant areas of audit identified in the Bank. which covers the audit of all major business units and operations within the Bank. the risk management process is in place and functioning and reviews high-level risk exposures to ensure that they are within the overall interests of the Bank. The AEC approves Group Internal Audit’s annual audit plan.Company No. Internal Audit and Internal Control Activities The Head of the Group Internal Audit Department reports to the AEC. and formulation of risk strategies. compliance with laws and regulations. 10 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . The risk-based audit plan is reviewed annually taking into account the changing financial significance of the business and risk environment. operational. operational controls. financial controls. Group Internal Audit assists the AEC in assessing and reporting on business risks and internal controls. lending practices and information technology. The functions encompass research and analysis. formulation of policies and risk assessment methodology. The Group Chief Internal Auditor and the external auditors also attend the AEC meetings by invitation and the AEC holds separate meetings with the Chief Internal Auditor and external auditors whenever necessary. portfolio risk exposure reporting. liquidity.) Risk Management Committee Risk management is an integral part of the Bank’s strategic decision-making process which ensures that the corporate objectives are consistent with the appropriate risk-return trade-off. Group Internal Audit also participates actively in major system development activities and project committees to advise on risk management and internal control measures. and operates within the framework defined in the Audit Charter. legal and capital risks impacting the Bank. all of whom are Independent Non-Executive Directors. where necessary. The Committee is independent from management and comprises three (3) members. The results of each audit are submitted to the AEC and significant findings are discussed during the AEC meetings. including the various application systems in production. The scope of internal audit covers reviews of adequacy of the risk management processes. The Board approves the risk management strategy and sets the broad risk tolerance level and also approves the engagement of new products or activities after considering the risk bearing capacity and readiness of the Bank.

) MANAGEMENT INFORMATION All Directors review Board papers and reports prior to the Board meeting. minutes of meetings of all Committees of the Board. Information and materials. the Bank’s wholly owned Islamic subsidiary at A1 (Stable) and P1 respectively.(Stable)/ F3 by Fitch Ratings Ltd and BBB-/A3/Stable from Capital Intelligence Ltd.Company No. Additionally.0 billion Medium Term Note Programme were reaffirmed at A2(Stable) by RAM.0 million Exchangeable Bonds and RM2. As at 31 March 2009.(Stable) /A3 by Standard and Poor’s Ratings Services. the Bank’s rating was complemented by international ratings of Baa2/P3 (Stable) by Moody’s Investors Services. The Board provides input on Group policies. relating to the operations of the Bank and its subsidiaries that are important to the Directors’ understanding of the items in the agenda and related topics. AmPremier had issued RM500. asset liability and market risk management and industry benchmarking as well as prevailing regulatory developments and the economic and business environment. The Hybrid Securities of USD200 million rating was reaffirmed Ba2 by Moody’s Investor Services. These reports are issued in sufficient time to enable the Directors to obtain further explanations. The Bank’s RM575. The Shariah Committee also assist in the setting up of business and operational procedures in respect of compliance with Shariah principles. monthly performance of the Bank. The Non-Cumulative Perpetual Capital Securities ("NCPCS") issued by the Bank during the current financial year was rated A3 by RAM. as the holding company and the ultimate holding company respectively. 8515–D CORPORATE GOVERNANCE (CONTD. The Board reports include among others. a long term rating of AmIslamic Bank's Subordinated Sukuk Musyarakah was also reaffirmed at A2 (Stable). The Bank's issuance of NCPCS was stapled to Subordinated Notes ("SubNotes") issued by its wholly-owned subsidiary company. BBB. AmPremier Capital Berhad ("AmPremier"). The long-term rating of the Bank's RM1. BBB. are distributed in advance of the meeting. HOLDING AND ULTIMATE HOLDING COMPANY The directors regard AMFB Holdings Berhad and AMMB Holdings Berhad. SHARIAH COMMITTEE The Shariah Committee was established under Bank Negara Malaysia’s “Guidelines on the Governance of Shariah Committee for Islamic Financial Institutions” (BNM/GPS1) to advise and provide guidance to the Board of Directors on all matters pertaining to Shariah principles including product development. Concurrently. RAM reaffirmed the long-term and short-term financial institution ratings for AmIslamic Bank. marketing and implementation activities. BB by Standard and Poor’s Rating Services and BB by Fitch Ratings Ltd. where necessary.0 million SubNotes which have been assigned a long-term rating of A3 (Stable).0 billion Negotiable Instruments of Deposits vested over from AmInvestment Bank Berhad was rationalised at A1. 11 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . RATING BY EXTERNAL AGENCIES The Bank’s long term financial institution rating of A1 and short-term rating of P1 with Stable outlook was reaffirmed by Rating Agency Malaysia Berhad (“RAM”). credit risk management. both of which are incorporated in Malaysia. in order to be briefed properly before the meeting.

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473.115.739 1.193 143.325.713 1.549 5.537 1.293 6.660.143 1.407 84. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies BALANCE SHEET AS AT 31 MARCH 2009 The Group 2009 2008 RM’000 RM’000 (Restated) The Bank 2009 2008 RM’000 RM’000 (Restated) Note ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for -trading Securities available -for-sale Securities held -to-maturity Derivative financial assets Loans.411 5.739.196 66.899.292 60.258 1.419 427. advances and financing Other assets Statutory deposit with Bank Negara Malaysia Deferred tax asset Investment in subsidiary companies Investment in associated companies Prepaid land lease payments Property and equipment Intangible assets TOTAL ASSETS 5 17.967 431.700 6.331.271 1.486 77.639 849.119 8.197 645.772.860 146.447 10.634.183.651 52.053.364 307.124.388.330.050 1.211 1.980 1.563 710.143 726.247 46.499 241.329.238.404 169.067 740 4.497 483.670 13.873 846.168 1.051 171.536 307.792 754.683.771.274 61.886 649.106.484 753.Company No.341.043 17 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .798 475.598.254.132 56.651 44.387.578 344.230 805 4.870 137 2.613 6 7 8 9 10 11 12 13 45 14 15 16 17 18 421.038 517.876 66.156.250 807.846 70.869 137 3.365.359 477.088 65.338.

979 1.600 1.262 5.364 3.000 200.618 77.037 1.460.384.312 3.853 1.119.000 - 243.186.000 271.217.254.243 6.716.739 825.899 670.242 825.577 41 5.801.364 3.943 6.472.490 131.000 71.866 352.870.909.846 9.000 600.857.000 271.979 1.857.497.225 150.601.507.037 1.402 460.000 689.469 860.199.361.062 5.820 500.914.007 1.641.716.120.000 145.149.363 4.211.341.000 61.000 79.213 5.000 575.434 8.604 155.853 1.729 1.) Note The Group 2009 2008 RM’000 RM’000 (Restated) The Bank 2009 2008 RM’000 RM’000 (Restated) LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation on loans sold to Cagamas Berhad Other liabilities Subordinated term loans Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Term loans Stapled Capital Securities Irredeemable Convertible Unsecured Loan Stocks Irredeemable NonCumulative Convertible Preference shares Total Liabilities Share capital Reserves Equity attributable to equity holder of the Bank Minority Interests Total Equity TOTAL LIABILITIES AND EQUITY COMMITMENTS AND CONTINGENCIES NET ASSETS PER SHARE (RM) 19 63.680 6.031.75 150.357.000 - 243.820 500.Company No.202. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies BALANCE SHEET AS AT 31 MARCH 2009 (CONTD.043 51.417 610.626 66.364 4.312 70.000.406 565.948 3.490 131.177.000.469 860.471.390.845 48.000 66.000 575.37 150.67 The accompanying notes form an integral part of the financial statements.000 145.007 1.376 352.000 575.741 53.471.619.364 5.19 32 33 670.249 8.186.211 45.980 34 52 47 49.460.867 20 10 21 7.626 5. 18 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .755 84.483 2.000 400.473.325 563.947.604 31 150.000 575.772.896 22 23 24(a) 24(b) 25 26 27 28 29 30 155.106.135 55.727 28 4.537.645.419 57.801 610.

088 174. 19 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .448) 1.694.908) (379.84 80.176) 1.110 1.165 (2.26 The accompanying notes form an integral part of the financial statements.862) (517.170 650.892.663) 1.194 759.767 (601) (329.896 46 104.785 529.220 376.978.414.896 Attributable to: Equity holder of the Bank Minority interests Profit after zakat and taxation Earnings per share (sen) Basic Fully diluted 701.594 65 1.194 (253.315 (694.290 (254.521.962 The Bank 2009 2008 RM’000 RM’000 (Restated) 3.016 (2.158.612.336 505. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies INCOME STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 The Group 2009 2008 RM’000 RM’000 (Restated) 4.804.352 (16) 650.628) (170.787.170 650.896 529.640 5.314 177.571 1.56 62.272) 1.Company No.750 4.411 Note Revenue Interest income Interest expense Net interest income Net income from Islamic Banking business Other operating income Net income Other operating expenses Operating profit Allowance for losses on loans and financing Provision for commitment and contingencies Impairment loss Profit before share in results of associated company and taxation Share in results of associated company Profit before zakat and taxation Zakat Taxation Profit after zakat and taxation 39 40 (349.107.866.032) (309.248 3.502 37 38 538.428) 1.290 784.974) (58.618.457) 980.785 505.409) 784.868.442) 1.606.283.71 68.652) 4 (177.89 83.183 (13) 701.71 86.44 75.374 3.431.659 (1.724.679 88 980.336 505.785 529.404 (902.210) (11.744 371.487 35 36 3.394) 44 701.011.180.141 2.904) 1.011.198 (760.043 533.068 (982.830) 759.024.264 (2.908 (2.698.725) 41 1.641) (119.025.075.718.587 3.252 2.66 98.192.865) 1.692) 296 (119.014) (1.

676 770.443 1.352 735.050 1.144 2.090) (184.144 4.676) 650.007 6.660 - 633.097) (2.792 710.097) 650.222 - 349.780.222 633. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2009 <-----------------------------------------.336 5.Company No.364 200.591 - 57 57 - 3.618 The accompanying notes form an integral part of the financial statements.364 610.093.Attributable to Equity Holder of the Bank ----------------------------------> Non-distributable Distributable ICULS Available UnapproShare (equity Share Statutory Merger Capital For-Sale priated Capital component) Premium Reserve Reserve Reserve Reserve Profits RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 The Group Minority Interests RM'000 Total Equity RM'000 At 1 April 2007 As previously stated Effect arising from the pooling of interests At 1 April 2007 (restated) Issue of Irredeemable Convertible Unsecured Loan Stocks Unrealised net loss on revaluation of securities availablefor-sale Effect arising from the pooling of interests Transfer to statutory reserve Profit/(loss) for the year At 31 March 2008 610.194 - 377.898 184.591 406.780.364 - 200.492 - 6.207 2.129.792 610.660 710.716.060 (16) 41 (8.660 137.007 - 406.792 710.587 200.873.401 377. AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 20 .313.207) (137.492 377.492 (8.

755 The accompanying notes form an integral part of the financial statements.232 (1.060 41 5.313.660 770.898 2.364 200.485) (1.909 (13) 28 (42. 21 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .471.904 (91.000 (200.581) 701.835) 397.357.792) 232.566 377.492 (42.716.835) 701.492 (2.184 - - - - - - - 91. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2009 <-------------------------------------------.915.392 670.Company No.904 (91.334 849.618 60.364 - 942.792 710.009) (44.099) 11.915.485) (79.334) 1.170 4.401 377.183 (78.090) - 735.844 78.Attributable to Equity Holder of the Bank ---------------------------------------------------> Distributable Non-distributable ICULS Available UnapproShare (equity Share Statutory Merger Capital For-Sale Other priated Minority Capital component) Premium Reserve Reserve Reserve Reserve reserves Profits Interests RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 The Group Total Equity RM'000 At 1 April 2008 Conversion of Irredeemable Convertible Unsecured Loan Stocks Unrealised net loss on revaluation of securities availablefor-sale Exchange fluctuation adjustments Unrealised net loss on cash flow hedge Effect arising from the pooling of interests Profit/(loss) for the year Transfer to statutory reserve At 31 March 2009 610.009) 11.

389 1.007 6.544 4. 22 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .933 6.446.459 1.628 918.446.628 (151.544 151.Company No.364 200.660 585.097) (2.627 680.007 (8.389) (94.896 5.364 610.792 710.000.660 710.896 1.627) 529.097) 529.090) 918.364 610.446.597.831.035 200.202.792 (8.544 1.626 The accompanying notes form an integral part of the financial statements.278.832 94.Attributable to Equity Holder of the Bank ---------------------------------------------> Non-distributable Distributable ICULS Available UnapproShare (equity Share Statutory Merger For-Sale priated Capital component) Premium Reserve Reserve Reserve Profits RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 Total Equity RM'000 At 1 April 2007 As previously stated Effect arising from the pooling of interests At 1 April 2007 (restated) Issue of Irredeemable Convertible Unsecured Loan Stocks Unrealised net loss on revaluation of securities available-for-sale Effect arising from the pooling of interests Transfer to statutory reserve Profit for the year At 31 March 2008 610.508 2.832 585.792 200. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2009 The Bank <-----------------------------.660 710.491 1.

785 3.857.597.364 Total Equity RM'000 At 1 April 2008 Conversion of Irredeemable Convertible Unsecured Loan Stocks Unrealised net loss on revaluation of securities available-for-sale Exchange fluctuation adjustments Unrealised net loss on cash flow hedge Effects arising from pooling of interests Profit for the year At 31 March 2009 200.459 680.885) (52.485) (1.597.Company No.485) (91.Attributable to Equity Holder of the Bank ----------------------------------------------------------> Non-distributable Distributable ICULS Available UnapproShare (equity Share Statutory Merger For-Sale Other priated Capital component) Premium Reserve Reserve Reserve reserves Profits RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 610.293 5.000. 23 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .184 942.312 The accompanying notes form an integral part of the financial statements.364 60.844 680.508 505.933) 505. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2009 The Bank <--------------------------------------.673) 1.660 232.202.785 1.975) (188) (91.459 1.708.792) - 710.000 670.626 91.933) - (2.392 (50.885) (188) (91.597.933 (1.792 (200.090) (50.

355 37.593) (46.085) 24.572) (5.806 20.767 759.328 (88) (11.325 (11.706 24.670 38. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 The Group 2009 2008 RM’000 RM’000 (Restated) CASH FLOWS FROM OPERATING ACTIVITIES Profit before zakat and taxation Adjustments for: Loan and financing loss and allowances.736 108.953 107.589 85 (7.214) (7.290 The Bank 2009 2008 RM’000 RM’000 (Restated) 715.783) 106.487 98.300) 122.211) (7. net of writeback Interest in suspense .584 37.073 24.976 (15.149) (26.907) (774) (5.176 1.134) 106.Company No.268) 54.659 980.886 94.003) (69.300) 123.572) (5.450) 821 (1.518 (17.085) 20.031) (70.315 (17.698 38.942 (477) (343) 680.404 (66.net Depreciation of property and equipment Amortisation of intangible assets Amortisation of prepaid land lease payments Transfer (from)/to profit equalisation reserve Amortisation of premium less accretion of discount Property and equipment written off Share of profits of associated company Gross dividend income from securities held-for-trading Gross dividend income from securities available-for-sale Gross dividend income from securities held-to-maturity Net (gain)/loss on sale of securities held-for-trading Net gain on sale of securities available-for-sale Net gain on sale/redemption of securities held-to-maturity Net loss on revaluation of securities held-for-trading Net (gain)/loss on revaluation of derivatives Impairment loss on securities Impairment loss on foreclosed property Gain on disposal of property and equipment Gain on disposal of foreclosed properties 1.296) 48.180 20.680 (64.214) (7.629) (101.942 (532) (343) 833.317) 828 (65) (1.626 37.068) 1.907) (774) (5.176 1.629) (101.194 784.764) 1.161 99 24.900) (46.339 37.586 (429) (975) 595.586 (429) (975) 24 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .012 79 (13.598 75.011.256) (26.682 105 (18.598 75.

216) 107.333) 7.338 (3.000 3.550 - 2.216) 107.167 146.167 155.) The Group 2009 2008 RM’000 RM’000 (Restated) CASH FLOWS FROM OPERATING ACTIVITIES (CONT'D) (Write-back)/Impairment loss on amount recoverable under asset-backed securitisation transaction (Write-back)/Impairment loss on sundry receivables Provision for/(write-back of) commitments and contingencies Amortisation of cost capitalised for issuance of Hybrid securities Interest paid on ICULS (equity portion) Unrealised loss on foreign exchange contracts Impairment loss on prepaid land lease payments Impairment loss on property and equipment Impairment of subsidiary companies Operating Profit Before Working Capital Changes (Increase)/Decrease In Operating Assets: Deposits and placements with banks and financial institutions Securities held-for-trading Loans.274) 92.097.236 - 10.142.648 (5.851) 24.976) (32. 8515–D AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 (CONTD.139 (296) 816 (5.524 254 2.236 115.903 1.039 1.061 25 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .737) 956.000) 144 (4) 816 (5.976) 1.524 254 2.068) (90.238.746.801.677.998 (74.641 816 (5.480 2.931 (3.729.Company No.150 4.974 816 (5.730 161.274) 92. advances and financing Other assets Securities purchased under resale agreement Statutory deposit with Bank Negara Malaysia The Bank 2009 2008 RM’000 RM’000 (Restated) (17.299) (11.216) 161.022.819 908.550 - (17.000) (3.263) (5.156 10.985.861 911.650 4.619 448.384.352.042 1.000 3.350 (13.746) 11.

Company No. 8515–D

AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 (CONTD.) The Group 2009 2008 RM’000 RM’000 (Restated) CASH FLOWS FROM OPERATING ACTIVITIES (CONT'D) The Bank 2009 2008 RM’000 RM’000 (Restated)

Increase/(Decrease) In Operating Liabilities: Deposits from customers Deposits and placements of banks and other financial institutions Obligation on securities sold under repurchase agreements Bills and acceptance payable Recourse obligation of loans sold to Cagamas Berhad Term loans Other liabilities Cash Generated From/(Used In) Operations Zakat paid Net taxation refunded/(paid) Net Cash Generated From/ (used in) Operating Activities

8,327,394

4,953,419

4,981,978

3,842,162

(536,460) 211,006 (88,942) (160,113) (560,678) 10,815,652

(1,384,130) (3,233,698) 447,666 (458,661) 167,810 134,020 (2,427,704)

43,949 145,784 (88,942) (160,113) (592,367) 9,021,235

(1,410,012) (3,233,698) 346,933 (458,661) 167,810 114,499 (2,665,036)

(503) 8,568 10,823,717

(786) (47,681) (2,476,171)

9,011 9,030,246

(38,180) (2,703,216)

26

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 (CONTD.) The Group 2009 2008 RM’000 RM’000 (Restated) CASH FLOWS FROM INVESTING ACTIVITIES Net purchase of securities available-for-sale Net sale of securities held-to maturity Net dividend received from securities held-for-trading Net dividend received from securities available-for-sale Net dividend received from securities held-to-maturity Proceeds from disposal of property and equipment Purchase of intangible assets Purchase of property and equipment Proceeds from disposal of foreclosed properties Capital injection to subsidiaries Subscription to ordinary shares of new subsidiary company Cash paid for net assets vested Net Cash (Used In)/Generated from Investing Activities The Bank 2009 2008 RM’000 RM’000 (Restated)

(3,803,726) 376,485 1,201 6,699 4,579 1,033 (4,639) (68,559) 10,185 (1,452,198) (4,928,940)

(35,437) 1,067,549 11,065 774 4,127 432 (10,721) (47,439) 8,945 999,295

(3,274,326) 377,874 1,201 6,699 4,559 583 (4,539) (68,475) 10,185 (118,156) (1) (1,137,344) (4,201,740)

(52,840) 1,063,876 11,065 774 4,106 432 (10,564) (47,245) 8,945 978,549

27

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

AmBank (M) Berhad (Incorporated in Malaysia) And Its Subsidiary Companies CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 (CONTD.) The Group 2009 2008 RM’000 RM’000 (Restated) CASH FLOW FROM FINANCING ACTIVITIES Repayment of subordinated term loan Proceeds from Medium term notes Proceeds from Exchangeable bonds Proceeds from ICULS Proceeds from INCPS Proceeds from issuance of Stapled Capital securities Repayment of subordinated bonds The Bank 2009 2008 RM’000 RM’000 (Restated)

(460,000) 600,000 500,000 (200,000)

860,000 575,000 300,000 150,000 -

(460,000) 600,000 500,000 (200,000)

860,000 575,000 300,000 150,000 -

Net Cash Generated From Financing Activities Net Increase In Cash And Cash Equivalents Cash And Cash Equivalents At Beginning Of Year Cash And Cash Equivalents At End Of Year (Note 5)

440,000

1,885,000

440,000

1,885,000

6,334,777 10,771,670

408,124 10,363,546

5,268,506 8,365,613

160,333 8,205,280

17,106,447

10,771,670

13,634,119

8,365,613

The accompanying notes form an integral part of the financial statements.

28

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

AmBank (M) Berhad (Incorporated in Malaysia) NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2009

1.

PRINCIPAL ACTIVITIES AND GENERAL INFORMATION The principal activity of the Bank is to carry on the business of a licensed commercial bank which also includes the provision of Islamic banking services via its 100% owned subsidiary, AmIslamic Bank Berhad. The principal activities of its subsidiary companies are disclosed in Note 14. There have been no significant changes in the nature of the activities of the Bank and its subsidiary companies during the financial year. The Bank is a public limited liability company, incorporated and domiciled in Malaysia. The registered office of the Bank is located at 22nd Floor, Bangunan AmBank Group, Jalan Raja Chulan, 50200 Kuala Lumpur. The principal place of business for the Retail and Business Banking Divisions are located at Menara AmBank, Jalan Yap Kwan Seng, 50450 Kuala Lumpur and Menara Dion, Jalan Sultan Ismail, 50250 Kuala Lumpur respectively. The financial statements of the Group and of the Bank have been approved and authorised for issue by the Board of Directors on 28th April 2009.

2.

BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS The financial statements of the Group and of the Bank have been prepared under the historical cost convention unless otherwise indicated and in accordance with the provisions of the Companies Act, 1965, the Banking and Financial Institutions Act, 1989, and the applicable Financial Reporting Standards (“FRS”) in Malaysia as modified by Bank Negara Malaysia (“BNM”) Guidelines. The financial statements incorporate those activities relating to the Islamic banking business, which have been undertaken by the Group. Islamic banking business refers generally to the acceptance of deposits, dealing in Islamic securities, granting of financing, capital market and treasury activities under the Shariah Principles. The financial statements are presented in Ringgit Malaysia (“RM”) and rounded to the nearest thousand, (RM’000) unless otherwise stated. The preparation of financial statements in conformity with FRS requires management to exercise judgement, use of estimates and make assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. Although these estimates are based on management’s best knowledge of current events and actions, actual results may differ from those estimates. Critical accounting estimates and assumptions used that are significant to the financial statements, and areas involving higher degree of judgement and complexity, are disclosed in Note 4.

29

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

SIGNIFICANT ACCOUNTING POLICIES The accounting policies are consistent with those adopted in the previous audited annual financial statements except for the adoption of the following: (i) The new and revised FRSs that are applicable to the Group and the Bank with effect from the financial period beginning on or after 1 April 2008: FRS 107 FRS 112 FRS 118 FRS 119 FRS 134 FRS 137 Amendments to FRS 121 IC Interpretation 8 Cash Flow Statements Income Taxes Revenue Employee Benefits Interim Financial Reporting Provisions. which is effective from 1 July 2009. Restoration and Similar Liabilities Members’ Shares in Co-operative Entities and Similar Instruments Rights to Interests arising from Decommissioning. Contingent Liabilities and Contingent Assets The Effects of Changes in Foreign Exchange Rates . 30 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . 8515–D 3. Restoration and Environmental Rehabilitation Funds Liabilities arising from Participating In a Specific Market-Waste Electrical and Electronic Equipment Applying the Restatement Approach to FRS 129 Financial Accounting in Hyperinflationary Economies (ii) The following are the FRSs and IC Intepretations which have been issued by the Malaysian Accounting Standards Board ("MASB") as of the balance sheet date but are not yet effective: FRS 139 FRS 4 FRS 7 FRS 8 IC Interpretation 9 IC Interpretation 10 Financial Instruments: Recognition and Measurement Insurance Contracts Financial Instruments: Disclosure Operating Segments Reassessment of Embedded Derivatives Interim Financial Reporting and Impairment All the new FRSs and IC Intepretations are effective from 1 January 2010 with the exception of FRS 8.Company No. Standards and IC Interpretations to existing standards that are not relevant or material for the Group and the Bank operations: FRS 111 FRS 120 IC Interpretation 1 IC Interpretation 2 IC Interpretation 5 IC Interpretation 6 IC Interpretation 7 Construction Contract Accounting for Government Grants and Disclosure of Government Assistance Changes in Existing Decommissioning.Net Investment in a Foreign Operation Scope of FRS 2 Share-based Payments The adoption of the above did not result in significant changes in accounting policies of the Group and the Bank.

This IC Interpretation is not expected to have any material impact on the financial statements of the Group and the Bank. financial information is required to be reported on the same basis as is used internally for evaluating operating segment performance and deciding how to allocate resources to operating segments.disclosure in the financial statements. and quantitative disclosures providing information about the extent to which an entity is exposed to risk. and the nature and extent of risks arising from financial instruments to which an entity is exposed and how these risks are managed. IC Interpretation 9 Reassessment of Embedded Derivatives – This interpretation clarifies that the reassessment of an embedded derivative after its initial recognition is forbidden unless the instrument’s terms have changed and this has affected its cash flows significantly. derecognition and measurement of an entity’s financial instruments and for hedge accounting. timing and uncertainty of future cash flows from insurance contracts. derecognition and measurement of financial instruments and hedge accounting which are similar to those prescribed by FRS 139 have been adopted by the Group and the Bank. This standard is not applicable to the annual financial statements of the Group and the Bank. FRS 8: Operating Segments – This new standard requires an entity to report financial and descriptive information about its reportable segments. SIGNIFICANT ACCOUNTING POLICIES (CONTD. Since 1 January 2005. Changes in Accounting Estimates and Errors is not required to be disclosed by virtue of exemptions provided under paragraph 103AB of FRS 139. The impact of applying FRS 139 on the financial statements upon first adoption of this standard as required by paragraph 30(b) of FRS 108 Accounting Policies. The application of this standard is not expected to have a material impact on the financial results of the Group and the Bank as this standard deals only with disclosures in the financial statements. policies and processes for managing those risks. In particular. Generally. 8515–D 3. (c) (d) (e) 31 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . upon the Group’s adoption of Bank Negara Malaysia’s (“BNM”) revised BNM/GP8 – Guidelines on Financial Reporting for Licensed Institutions. FRS 7 Financial Instruments: Disclosures – This new standard requires disclosures in financial statements that enable users to evaluate the significance of financial instruments for the entity’s financial position and performance. This standard requires both qualitative disclosures describing management’s objectives.Company No. An entity shall not apply this standard for annual periods beginning prior to 1 January 2010 unless it also applies FRS 139. it requires disclosures that identify and explain the amounts in an insurer’s financial statements arising from insurance contracts and helps users of those financial statements understand the amount. Operating segments are components of an entity about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. certain principles in connection with the recognition. based on information provided internally to the entity’s key management personnel. These accounting policies are set out in the Notes on securities and derivative instruments below. (b) FRS 4 Insurance Contracts – This new standard specifies the financial reporting requirements for insurance contracts by any entity that issues such contracts (“insurers”). The application of this standard would not have any impact to the financial statements of the Group. Reportable segments are operating segments or aggregations of operating segments that meet specified criteria.) The effects of adopting these standards are discussed below: (a) FRS 139 Financial Instruments: Recognition and Measurement – This standard establishes the principles for the recognition.

of the assets given. the MASB announced its plan to bring Malaysia to full convergence with International Financial Reporting Standards (“IFRS”) by 1 January 2012. intergroup balances and unrealised gains or losses are eliminated in full. Any excess of the Group’s interest in the net fair value of the identifiable assets. 32 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . The cost of an acquisition is measured as the aggregate of the fair values. the Bank adopted the above guidelines issued by BNM. The financial impact and effects on disclosures and measurement ensuing from such convergence are currently still being assessed pending the issuance of such revised FRSs incorporating the full convergence. and continue to be consolidated until the date that such control ceases. In August 2008. (b) Basis of Consolidation The financial statements of the Group include the financial statements of the Bank and all its subsidiary companies listed under Note 14 made up to the end of the financial year. liabilities incurred or assumed and equity instruments issued. Subsidiaries are consolidated from the date of acquisition being the date on which the Group obtains control. (iii) Guidelines issued on 20 October 2008 by Bank Negara Malaysia (BNM) “Reclassification of Securities under Specific Circumstances” During the financial year. liabilities and contingent liabilities represents goodwill. (a) Basis Of Accounting The financial statements of the Group and of the Bank have been prepared under the historical cost convention unless otherwise indicated in the accounting policies below. The Bank adopts the purchase method in preparing the consolidated financial statements except where the criteria for the merger accounting method as permitted under FRS 122: Business Combinations are met. is recognised immediately in the income statement. SIGNIFICANT ACCOUNTING POLICIES (CONTD.) (f) IC Interpretation 10 Interim Financial Reporting and Impairment – This interpretation clarifies that an entity shall not reverse impairment losses on goodwill and investments in equity instruments and financial assets carried at cost recognised in an interim period. 8515–D 3. This interpretation is not applicable to the annual financial statements of the Group. Any excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets. plus any costs directly attributable to the business combination. Uniform accounting policies are adopted in the consolidated financial statements for like transactions and events in similar circumstances. liabilities and contingent liabilities over the cost of acquisition. after reassessment. The effects of this reclassification are as disclosed in note 56. The purchase method of accounting involves allocating the cost of the acquisition to the fair value of the assets acquired and liabilities and contingent liabilities assumed at the date of acquisition.Company No. This concession is only effective from 1 July 2008 to 31 December 2009. at the date of exchange. The above Guideline sets out the limited circumstances in which banking institutions are allowed to reclassify financial instruments held as securities held-for-trading portfolio into the securities available-for-sale and securities held-tomaturity portfolios. In preparing the consolidated financial statements.

the excess and further losses applicable to the minority interest are attributable to the equity holder of the Bank or subsidiary companies. On consolidation. a licensed offshore bank). together with the assets and liabilities are included into the financial statements of the Bank and the Group as if the merger had been effected prior to and throughout the current financial year. Minority interest represents that part of the net results of operations and net assets of a subsidiary company attributable to equity interests and debentures that are not owned. Pursuant to the Business Transfer Agreement dated 11 March 2008 and the Vesting Order granted by the High Court of Malaya on 9 April 2008. Any share premium. Interest and financing income on investments are recognised on an effective yield basis. Under the pooling of interest method. directly or indirectly through subsidiary companies. All gains or losses on disposal of subsidiaries are recognised in the consolidated income statement. Any resulting debit difference is adjusted against any suitable reserve. the transaction has been accounted for via the pooling of interest method (‘Merger”). the Group acquired the assets and assumed the liabilities relating to AmInvestment Bank Berhad’s (AmInvestment Bank) conventional/Islamic Fund-Based Activities (including AmInvestment Bank’s 100% shareholding interest in AmInternational (L) Ltd. 8515–D 3. As the vesting of assets and assumption of liabilities were carried by entities under common control. and is able to. by the Bank or subsidiary companies. the results of subsidiaries are presented as if the merger had been effected throughout the current and previous years. Any resulting credit difference is classified as equity and regarded as a non-distributable reserve. Interest and financing income includes the amortisation of premium or accretion of discount. capital redemption reserve and any other reserves which are attributable to share capital of the merged enterprises. are reclassified and presented as movement in other capital reserves. to the extent that they have not been capitalised by a debit difference. Interest and financing income from hire purchase financing and block discounting of the Group and Bank is recognised using the ‘sum-ofdigits’ method. comparative figures of the Bank and the Group have been restated. (d) Interest and Financing Income and Expense Recognition Interest and financing income is recognised in the income statement for all interest bearing assets on an accrual basis. The assets and liabilities combined are accounted for based on the carrying amounts from the perspective of the common control shareholder at the date of transfer. 33 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . Interest and financing income on overdrafts.) (b) Basis of Consolidation (contd) Where the merger accounting method is used. The gain or loss on disposal of a subsidiary company is the difference between the net disposal proceeds and the Group’s share of its net assets as of the date of disposal including the cumulative amount of any exchange differences that relate to the subsidiary company being disposed. certain Heldfor-Trading securities were reclassified to Securities Available for Sale and arising from the Merger.Company No. the cost of the merger is cancelled with the values of the shares received. except when the losses applicable to the minority interest exceed the minority interest in the equity of that subsidiary company. When that subsidiary company subsequently reports profits. In such cases. unless the minority interest has a binding obligation to. make good the losses. term loans and housing loans is accounted for on an accrual basis by reference to the rest periods as stipulated in the loan agreements. (c) Operating Revenue Operating revenue of the Group and the Bank comprise interest income and other operating income. the results of the business transferred from AmInvestment Bank. Pursuant to the Business Transfer. It is measured at the minorities' share of the fair value of the subsidiary companies' identifiable assets and liabilities at the acquisition date and the minorities' share of changes in the subsidiary companies’ equity since that date. the profits applicable to the minority interest are attributed to the equity holder of the Bank or subsidiary companies until the minority interest’s share of losses previously absorbed by the equity holder of the Bank or subsidiary companies has been recovered. SIGNIFICANT ACCOUNTING POLICIES (CONTD.

Company No. (f) Employee Benefits (i) Short-Term Benefits Wages. Thereafter. During the financial year. Interest expense and attributable income (pertaining to activities relating to Islamic Banking Business) on deposits and borrowings of the Bank are recognised on an accrual basis. advances and financing is in conformity with BNM's "Guideline on Classification of Non-Performing Loans and Provisions for Substandard. incidental expenses incurred as part of the “Zero Entry cost” package offered for housing loans and commercial property loans are capitalized and amortised over the average lock-in period of the loans. The Group's policy on recognition of interest income on loans. bankers’ acceptances and trust receipts. the Group and the Bank have no further payment obligations. (ii) Defined Contribution Plan As required by law. bonuses and social security contributions are recognised as an expense in the year in which the associated services are rendered by employees of the Group and the Bank. . participation fees and commissions are recognised as income when all conditions precedent are fulfilled. Customers’ accounts are deemed to be non-performing where repayments are in arrears for more than three (3) months from first day of default or after maturity date for trade bills. Dividends are recognised when the right to receive payment is established. When a loan becomes non-peforming.) (d) Interest and Financing Income and Expense Recognition Handling fees paid to motor vehicle dealers for hire purchase loans are amortised in the income statement over the tenor of the loan in accordance with BNM Circular on Handling Fees dated 16 October 2006 and is set off against interest income recognised on the hire purchase loans. interest accrued and recognised as income prior to the date the loan is classified as non-performing is reversed out of income and set-off against the accrued interest receivable account in the balance sheet. and short-term non-accumulating compensated absences such as sick leave are recognised when the absences occur. 34 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . over the duration of the guarantee period. (e) Recognition of Fees and Other Income Loan arrangement fees. Short-term accumulating compensated absences such as paid annual leave are recognised when services are rendered by employees that increase their entitlement to future compensated absences. Once the contributions have been paid. interest on the non-performing loan shall be recognised as income on a cash basis. Other fees on a variety of services and facilities extended to customers are recognised on inception of such transactions. 8515–D 3. salaries. SIGNIFICANT ACCOUNTING POLICIES (CONTD. Guarantee fees are recognised as income upon issuance and where the guarantee period is longer than one year. Such contributions are recognised as an expense in the income statement as incurred. Property rental are recognised on an accrual basis. Bad and Doubtful Debts"("BNM/GP3") and revised Guidelines on Financial Reporting for Licensed Institutions (BNM/GP8). The effect of this change is disclosed in Note 58. companies within the Group make contributions to the state pension scheme.

there is no prospect of recovery. if any. The Directors are of the view that such treatment will reflect a more prudent provisioning policy for loans. advances and financing of the Group are computed in conformity with the revised BNM's guidelines on the “Classification of Non-Performing Loans and Provisions for Substandard. A general allowance based on a percentage of total outstanding loans (including accrued interest). An uncollectible loan and financing or portion of a loan and financing classified as bad is written off after taking into consideration the realisable value of collateral. when in the judgement of management. management considers several factors such as the borrower's financial position. net of specific allowance for bad and doubtful debts. advances and financing. The Group and the Bank recognises termination benefits when it is demonstrably committed to either terminate the employment of current employees according to a detailed formal plan without possibility of withdrawal or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. In evaluating collectibility. cash flow projections. (h) Provisions Provisions are recognised when the Group or the Bank has a present legal obligation as a result of past events. advances and financing are stated at cost less any allowance for bad and doubtful debts and financing. The specific and general allowances for loans. Benefits falling due more than 12 months after balance sheet date are discounted to present value. whereby loans are classified as non-performing and sub-standard when repayments are in arrears for more than three (3) months from the first day of default or after maturity date. Allowances for doubtful debts and financing are made based on management's evaluation of the portfolio of loans. quality of collateral or guarantee supporting the receivables as well as prevailing and anticipated economic conditions. (b) (ii) Specific allowance of 20% is provided on non-performing loans which are four (4) to less than six (6) months-in-arrears. However.) (f) Employee Benefits (contd) (iii) Termination Benefits Termination benefits are payable whenever an employee's employment is terminated before the normal retirement date or whenever an employee accepts voluntary redundancy in exchange for these benefits. 8515–D 3.Company No. SIGNIFICANT ACCOUNTING POLICIES (CONTD. it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation. and no value assigned to the realisable value of the properties held as collateral for non-performing loans which are in arrears for more than seven (7) years. 35 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . Bad and Doubtful Debts” (“BNM/GP3”) requirements. The Group adopted a more stringent basis for specific allowances on non-performing loans and are as follows: (i) Values assigned to collateral held for non-performing loans secured by properties is determined based on the realisable values of the properties on the following basis: (a) assigning only fifty percent (50%) of the realisable value of the properties held as collateral for nonperforming loans which are in arrears for more than five (5) years but less than seven (7) years. when the collectibility of receivables becomes uncertain. advances and financing. and when a reliable estimate of the amount can be made. is maintained by the Group and the Bank against risks which are not specifically identified. (g) Allowance for Doubtful Debts and Financing Loans. management. the Group has adopted a more stringent classification policy on non-performing loans.

Impairment losses on investments in equity instruments classified as available-for-sale recognised are not reversed subsequent to its recognition. AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 36 . PER is maintained up to the maximum of 30% of total Islamic banking capital fund. The reversal is recognised in the income statement immediately. Impairment is measured by comparing the carrying values of the assets with their recoverable amounts. even though the securities have not been derecognised. The amount of the impairment loss is recognised in the income statement. other income and irregular income. The amount appropriated is shared by the depositors and the Group. Such impairment losses are not reversed in subsequent periods. (ii) Securities held-to-maturity For securities held-to-maturity which are carried at amortised cost. Reversals of impairment losses on debt instruments classified as available-for-sale are recognised in the income statement if the increase in fair value can be objectively related to an event occurring after the recognition of the impairment loss in the income statement. monthly net trading income. The cumulative impairment loss is measured as the difference between the acquisition cost (net of any principal repayment and amortisation) and the current fair value. the amount of the impairment loss is measured as the difference between the carrying amount of the asset and present value of its estimated future cash flows discounted at the current market rate of return for a similar financial asset. the cumulative impairment loss that had been recognised directly in equity shall be transferred from equity to the income statement. to the extent that the securities’ carrying amount does not exceed its amortised cost if no impairment had been recognised. The recoverable amount is the higher of net realisable value and value in use. less any impairment loss previously recognised in the income statement. Subsequent reversals in the impairment loss is recognised when the decrease can be objectively related to an event occurring after the impairment was recognised. SIGNIFICANT ACCOUNTING POLICIES (CONTD. (iii) Other assets The carrying values of assets are reviewed for impairment when there is an indication that the asset might be impaired. Subsequent increase in the recoverable amount of an asset is treated as reversal of the previous impairment loss and is recognised to the extent of the carrying amount of the asset that would have been determined (net of amortisation and depreciation) had no impairment loss been recognised. For securities held-to-maturity which are carried at cost.Company No. the amount of the impairment loss is measured as the difference between the assets’s carrying amount and the present value of the estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The reversal is recognised in the income statement. (j) Impairment of Assets (i) Securities available-for-sale Impairment of securities available-for-sale is calculated as the difference between the asset’s carrying amount and the estimated recoverable amount. PER is deducted from the total Islamic banking gross income in deriving the net distributable gross income at a rate which does not exceed the maximum amount of the total of 15% of monthly gross income. For securities available-for-sale in which there is objective evidence of impairment which is other than temporary. 8515–D 3.) (i) Profit Equalisation Reserve ("PER") PER is the amount appropriated out of the total Islamic banking gross income in order to maintain a certain level of return to depositors as stipulated by Bank Negara Malaysia’s Circular on “Framework of Rate of Return”. which is measured by reference to discounted future cash flows. An impairment loss is charged to the income statements immediately.

37 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . in which case it is recognised in equity. disposed of or impaired. accretion of discount and impairment as well as gain or loss arising from the derecognition of securities held-to-maturity are recognised in the income statement. Current tax expense is determined according to the tax laws of each jurisdiction in which the Group operates and includes all taxes based on the taxable profits. 8515–D 3. In principle. Deferred tax is not provided for goodwill or from the initial recognition of assets and liabilities that at the time of transaction. based on the laws enacted or substantively enacted at the balance sheet date. affects neither accounting nor taxable profit. deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences and unutilised tax losses to the extent it is probable that taxable profit will be available against which the deductible temporary differences and unutilised tax losses can be utilised. Any sale or reclassification of a significant amount of securities held-to-maturity not close to their maturity would result in the reclassification of all securities held-to-maturity to securities available-forsale. Amortisation of premium. Any gain or loss arising from a change in fair value are recognised directly in equity through the statement of changes in equity. (ii) Securities available-for-sale Securities available-for-sale are financial assets that are not classified as held-for-trading or held-tomaturity. The securities held-to-maturity are measured at accreted/amortised cost based on effective yield method less impairment losses. Deferred tax is provided.) (k) Income Tax Tax expense comprises current and deferred tax. The securities available-for-sale are measured at fair value or at amortised cost (less impairment losses) if the fair value cannot be reliably measured. Income tax is recognised in the income statement except to the extent it relates to items recognised directly in equity. if any. until the financial asset is sold. (l) Securities The holdings of the securities portfolio of the Group and the Bank are recognised based on the following categories and valuation methods: (i) Securities held-for-trading Securities are classified as held-for-trading if they are acquired principally for the purpose of benefiting from actual or expected short-term price movement or to lock in arbitrage profits. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse. using the balance sheet method. at which time the cumulative gain or loss previously recognised in equity will be transferred to the income statements. SIGNIFICANT ACCOUNTING POLICIES (CONTD. collected.Company No. Unquoted shares in organisations set up for socio-economic purposes and equity instruments received as a result of loan restructuring or loan conversion which do not have a quoted market price in an active market and whose fair value cannot be reliably measured are also classified as securities held-to-maturity. on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. and prevent the Group from classifying the similar class of securities as securities held-to-maturity for the current and following two financial years. The securities held-fortrading are stated at fair value and any gain or loss arising from a change in their fair values or the derecognition of securities held-for-trading are recognised in the income statements. (iii) Securities held-to-maturity Securities held-to-maturity are financial assets with fixed or determinable payments and fixed maturity that the Group have the positive intent and ability to hold to maturity.

if any. When the Group's share of losses in an associated company equals or exceeds its interest in the associated company. 8515–D 3. (n) Other Assets (i) Amount Recoverable Under Asset-Backed Securitisation ("ABS") Transaction This relates to the balance of sale consideration under ABS transaction due from the Special Purpose Vehicle ("SPV"). (o) Investment in Subsidiary Companies A subsidiary company is a company in which the Group has power to directly or indirectly govern the financial and operating policies of an entity so as to obtain benefits from their activities. net of accumulated impairment losses. SIGNIFICANT ACCOUNTING POLICIES (CONTD. (p) Investment in Associated Companies An associated company is a company in which the Group exercises significant influence. Potential voting rights that are exercisable or convertible are considered when assessing control. Significant influence is the power to participate in the financial and operating policy decisions of the associates but not in control over those policies. 38 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . portfolios of receivables are sold to a SPV which are funded through the issuance of bonds secured by the receivables. if any. Investment in associated companies are accounted for using the equity method of accounting and are initially recognised at cost. whereby the amount will be recovered upon maturity of the underlying bonds. Allowance for doubtful debts is made based on estimates of possible losses which may arise from non-collection of certain receivable accounts.) (m) Trade and Other Receivables Trade and other receivables are stated at book value as reduced by the appropriate allowances for estimated irrecoverable amounts. of such properties. The difference between the sale consideration and the receivables sold is recognised to the income statement. When an indication of impairment exists. Under the ABS.Company No. including any other unsecured receivables. (ii) Foreclosed Properties Foreclosed properties are those acquired in full or partial satisfaction of debts and are stated at cost less impairment losses in value. but which it does not control. the Group does not recognise further losses. except to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associated company. and its share of post-acquisition movements in reserves is recognised in reserves from the date that significant influence commences and until the date that significant influence ceases. the carrying amount of the amount recoverable under ABS transaction is assessed and written down to its recoverable amount. The Group's share of its associated company's post-acquisition profits or losses is recognised in the income statement. The Group's investment in associated company includes premium on consolidation identified on acquisition. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment.

39 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . prepared at a date not more than three months prior to the end of the financial year of the Group. only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.20% 10% . and is recognised in the income statements. as appropriate. On disposal of such investments. Subsequent to initial recognition. at each balance sheet date. if any. Gain or loss arising from disposal of an asset is determined as the difference between the estimated net disposal proceeds and the carrying amount of the asset. Investment in associated company are stated at cost less accumulated impairment losses. SIGNIFICANT ACCOUNTING POLICIES (CONTD.) (p) Investment in Associated Companies (Contd. The carrying amount of the replaced parts are derecognised. to ensure that they reflect the expected economic benefits derived from these assets.25% The residual values. property and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.Company No. if any. 8515–D 3. the differences between the net disposal proceeds and their carrying amounts are recognised in the income statements.20% 10% . Depreciation of other property and equipment is calculated using the straight-line method at rates based on the estimated useful lives of the various assets. Freehold land and capital work in progress are not depreciated.) The results of the associated company is taken from the latest audited accounts or unaudited management accounts of the associated company. (q) Property and Equipment and Depreciation All items of property and equipment are initially recorded at cost.25% 20% . An asset is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. and adjusted if appropriate. All other repairs and maintenance are charged to the income statement when they are incurred. useful lives and depreciation methods of assets are reviewed. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset. in the Bank's balance sheet.33 1/3% 20% . The annual depreciation rates for the various classes of property and equipment are as follows: Freehold buildings Leasehold buildings Leasehold improvements Office equipment Furniture and fittings Computer hardware Motor vehicles 2% 2% or over the term of short term lease 10% . The policy for the recognition and measurement of impairment losses is in accordance with the policy on impairment of assets.

Computer software development costs recognised as assets are amortised using the straight-line method over their useful lives of three to seven years. Leases which do not meet such criteria are classified as operating leases and the related rentals are charged to the income statement as incurred. the up-front payments made are allocated between the land and building elements in proportion to the relative fair values for the leasehold interests in the land element and building element of the lease at the inception of the lease. when it is practicable to determine. Investment properties are derecognised when either they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains or losses on the retirement or disposal of an investment property are recognised in the income statement in the year in which they arise. When an operating lease is terminated before the lease period has expired. otherwise the Group's incremental borrowing rate is used. (s) Assets Purchased under lease Assets purchased under finance leases which in substance transfer the risks and benefits of ownership of the assets to the Group are capitalised under property and equipment. For lease of land and buildings. Investment properties of the Group are stated at cost less any accumulated depreciation and impairment losses. Costs that are directly associated with software application development stage are recognised as intangible assets. (t) Investment Properties Investment properties are properties which are held either to earn rental income or for capital appreciation or for both. any payment required to be made to the lessor by way of penalty is recognised as an expense in the period in which termination takes place. SIGNIFICANT ACCOUNTING POLICIES (CONTD. The prepaid land lease payments are amortised on a straight line basis over the remaining lease term. These costs are amortised using the straight line method over their expected useful lives of three to five years. the discount factor used is the interest rate implicit in the lease. Costs directly associated with software application development include employee payroll and payroll related costs. Costs associated with maintaining computer software programmes are recognised as an expense when incurred. Properties that are occupied by the companies in the Group are accounted for as owner-occupied rather than as investment properties.) (r) Intangible Assets Acquired computer software licenses are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. Investment properties are depreciated on a straight line basis to write off the cost of the assets to their residual values over their estimated useful lives.Company No. less accumulated depreciation and impairment losses. In calculating the present value of the minimum lease payments. Leasehold land held for own use is classified as operating lease. The assets and the corresponding lease obligations are recorded at the lower of the present value of the minimum lease payments or the fair value of the leased assets at the beginning of the lease terms. The up-front payments made on acquiring leasehold land is accounted for as prepaid land lease payments. 8515–D 3. 40 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .

(w) Trade and Other Payables Trade and other payables are stated at cost which is the fair value of the consideration to be paid in the future for goods and services received. 8515–D 3.Company No. (y) Interest-Bearing Instruments All borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction costs. specific provisions for commitments and contingencies are made when in the event of a call or potential liability and there is a shortfall in the security value supporting these instruments. After initial recognition.) (u) Repurchase Agreements Securities purchased under resale agreements are securities which the Group and the Bank had purchased with a commitment to resell at future dates. (z) Hybrid Capital Hybrid capital is classified as liabilities in the balance sheet as there is a contractual obligation by the Group to make cash payments of either principal or interest or both to holders of the instruments and the Group is contractually obliged to settle the financial instrument in cash or through another financial instrument. SIGNIFICANT ACCOUNTING POLICIES (CONTD. (v) Bills and Acceptances Payable Bills and acceptances payable represent the Group's and the Bank's own bills and acceptances rediscounted and outstanding in the market. with commitment to repurchase at future dates for funding purposes. Conversely. The carrying values of the securities underlying these repurchase agreements remain as assets on the balance sheet of the Group and of the Bank while the obligations to repurchase such securities at agreed prices on specified future dates are accounted for as a liability on the balance sheet. obligations on securities sold under repurchase agreements are securities which the Group and the Bank had sold from its portfolio. 41 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . interest bearing borrowings are subsequently measured at amortised cost using the effective interest method. (x) Provision for Commitments and Contingencies Based on management's evaluation. The commitments to resell the securities are reflected as an asset on the balance sheet.

The transaction costs of equity.Company No.47 31. At each balance sheet date. Equity transaction costs comprise only those incremental external costs directly attributable to the equity transaction which would otherwise have been avoided. The principal exchange rates for every unit of foreign currency ruling at balance sheet date used for translation of foreign operations are as follows: 31. monetary items denominated in foreign currencies are translated at the rates prevailing on the balance sheet date. Dividends on ordinary shares are recognised as an appropriation of unappropriated profits in the year in which they are approved. the Bank's Labuan offshore branch. 8515–D 3.64 0. which is also the Bank's functional currency. Exchange differences arising on the settlement of monetary items. (ab) Foreign Currencies (i) Functional and Presentation Currency The individual financial statements of each entity in the Group are measured using the currency of the primary economic environment in which the entity operates ("the functional currency"). Non-monetary items carried at fair value that are denominated in foreign currencies are translated at the rates prevailing on the date when the fair value was determined. and on the translation of monetary items.03.2009 United States Dollar (USD) Hong Kong Dollar (HKD) 3.41 42 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . Gains or losses arising on translation into RM are classified as equity and transferred to exchange fluctuation reserve. are included in the income statement for the year. subsidiary and associated companies expressed in foreign currencies are translated into RM at the rates of exchange ruling at the balance sheet date while income statement is translated into RM at the average exchange rate for the year. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated at the exchange rate prevailing at the date of the initial transaction.) (aa) Equity Instruments Ordinary shares are classified as equity. The consolidated financial statements are presented in Ringgit Malaysia ("RM"). net of tax are accounted for as deduction from equity.19 0. (ii) Foreign Currency Transactions In preparing the financial statements of the Bank. Exchange differences arising on the translation of non-monetary items carried at fair value are included in the income statement for the year except for differences arising on the translation of non-monetary items in respect of which gains and losses are recognised directly in equity. (iii) Foreign Operations For the purpose of presenting consolidated financial statements. subsidiary and associated companies. SIGNIFICANT ACCOUNTING POLICIES (CONTD. the assets and liabilities of the Bank's Labuan offshore branch.03. transactions in currencies other than the entity's functional currency are recorded at the rates of exchange prevailing on the dates of the transactions.2008 3.

The Bank enters into derivative transactions for trading and for hedging purposes. In the event the hedge no longer meets the criteria for hedge accounting. For actual effectiveness to be achieved. For qualifying cash flow hedges. terminated or exercised or if the hedge no longer meets the criteria for hedge accounting or is revoked. Amounts accumulated in equity are released to the income statement in the periods when the hedged forecast transactions affect the income statement. fair value changes are recognised in the income statement. The Bank discontinues hedge accounting if the hedging instrument expires. (ii) Cash flow hedge Cash flow hedges are hedges of the exposure to variability in future cash flows that is attributable to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction and could affect profit or loss.Company No. Gains and losses are recognised upon sale and shown as trading gain or loss from securities held for trading. the Bank formally documents the relationship between the hedging instrument and the hedged item. The gain or loss relating to the ineffective portion is recognised immediately in the income statement. the effective portion of the change in fair value of the hedging instrument is taken to equity as a cash flow hedge reserve. 43 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . For derivatives held-fortrading. 8515–D 3. Fair values of over-the-counter derivatives are obtained using valuation techniques. is sold. Hedges are expected to be highly effective and are assessed on an ongoing basis to ensure that they remain highly effective throughout the hedge period. At the time a financial instrument is designated as a hedge. (i) Fair value hedge Fair value hedges are hedges against exposure to changes in the fair value of a recognised asset or liability or an unrecognised firm commitment that is attributable to a particular risk and could affect profit or loss. Fair values of exchange-traded derivatives are obtained from quoted market prices. the changes in fair value of the hedging instrument and the hedged item relating to the hedged risk are recognised in the income statement. For qualifying fair value hedges. SIGNIFICANT ACCOUNTING POLICIES (CONTD. (ad) Sell and Buy Back Agreements These are obligations of the Group to perform its commitment to buy back specified Islamic securities at maturity. the Group applies either fair value or cash flow accounting. For derivative transactions that meet the specific criteria for hedge accounting. the gain and loss previously deferred in equity is transferred from equity and included in the initial measurement of the cost of the asset or liability. the changes in fair value or cash flows of the hedging instrument and the hedged item must offset each other in the range of 80% to 125%. Financial derivatives are classified as assets when their fair values are positive and as liabilities when their fair values are negative. the risk management objective and strategy for undertaking the hedge and the method used to assess hedge effectiveness. If the hedged forecast transactions result in the recognition of a non-financial asset or a non-financial liability. including the discounted cash flows method and option pricing models. the adjustment to the carrying amount of the hedged item is amortised to the income statement over the expected life of the hedged item. including the nature of the risk to be hedged. and are subsequently remeasured at fair value.) (ac) Derivative Financial Instruments and Hedge Accounting Derivative financial instruments are recognised at fair value upon inception in the balance sheet.

Company No. 8515–D

3.

SIGNIFICANT ACCOUNTING POLICIES (CONTD.) (ae) Contingent Assets and Contingent Liabilities The Group and the Bank does not recognise a contingent liability but discloses its existence in the financial statements. A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Group and the Bank or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in the extremely rare case where there is a liability that cannot be recognized because it cannot be measured reliably. A contingent asset is a possible asset that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Group and the Bank. The Group and the Bank does not recognize contingent assets but discloses its existence where inflows of economic benefits are probable, but not virtually certain. (af) Cash Flow Statements The Group and the Bank adopt the indirect method in the preparation of the cash flow statements. (ag) Cash and Cash Equivalents For the purpose of the cash flow statements, cash and cash equivalents consist of cash and short term funds, net of outstanding overdrafts (if any).

44

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

4.

SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. Although these estimates are based on management’s best knowledge of current events and actions, actual results may differ from those estimates. Critical accounting estimates and assumptions used that are significant to the financial statements, and areas involving higher degree of judgement and complexity are as follows:

a)

Fair value estimation The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions existing at the balance sheet date. Quoted market prices or dealer quotes for similar instruments and discounted cash flows are some of the common techniques used to calculate the fair value of these instruments.

b)

Classification between investment properties and property and equipment The Group has developed certain criteria based on FRS 140 in making judgement whether a property qualifies as an investment property. Investment property is held to earn rentals or for capital appreciation or both. Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goods or services or for administrative purposes. If these portion could be sold separately, the Group would account for the portion separately. If the portion could not be sold separately, the property is an investment property only if insignificant portion is held for use in the production or supply of goods or services or for administrative purposes. Judgement is made on an individual property basis to determine whether ancillary services are so significant that a property does not qualify as investment property.

c)

Deferred tax assets Deferred tax assets are recognised for all unutilised tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits together with future tax planning strategies.

d)

Allowance for Bad and Doubtful Debts Whilst the assessment of allowance for losses on financing and advances is made in accordance with the requirements of “BNM/GP3” guidelines, judgement is required in the estimation of realisation amount from the doubtful debts when determining the level of allowance required.

45

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

5.

CASH AND SHORT-TERM FUNDS The Group 2009 2008 RM’000 RM’000 Cash and balances with banks and other financial institutions Money at call and deposits placements maturing within one month The Bank 2009 2008 RM’000 RM’000

482,786

928,022

471,372

390,826

16,623,661 17,106,447

9,843,648 10,771,670

13,162,747 13,634,119

7,974,787 8,365,613

Included in the above are interbank lending by the Group and the Bank of RM16,385,301,000 (2008: RM9,349,440,000) and RM12,924,387,000 (2008: RM7,880,580,000) respectively. Included in money at call and deposit placement maturing within one month is an amount of RM238,359,500 (2008:RM 94,206,800) representing collateral pledged with counterparties pursuant to interest rate swap agreements. As at 31 March 2009, the net interbank lending of the Group and of the Bank are as follows: The Group 2009 2008 RM’000 RM’000 Interbank lending Cash and short term funds Deposits with banks and other financial institutions (Note 6) Interbank borrowing (Note 20) Net interbank lending/(borrowing) The Bank 2009 2008 RM’000 RM’000

16,385,301

9,349,440

12,924,387

7,880,580

421,050 16,806,351 (793,759) 16,012,592

1,329,700 10,679,140 (1,430,325) 9,248,815

421,050 13,345,437 (1,191,302) 12,154,135

1,329,700 9,210,280 (1,422,173) 7,788,107

6.

DEPOSITS AND PLACEMENTS WITH BANKS AND OTHER FINANCIAL INSTITUTIONS The Group 2009 2008 RM’000 RM’000 Licensed banks Licensed merchant bank Bank Negara Malaysia 421,050 421,050 279,700 50,000 1,000,000 1,329,700 The Bank 2009 2008 RM’000 RM’000 6,093 421,050 427,143 288,293 50,000 1,000,000 1,338,293

Included in the above are interbank lending by the Group and the Bank of RM421,050,000 (2008: RM1,329,700,000).

46

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

7.

SECURITIES HELD-FOR-TRADING The Group 2009 2008 RM’000 RM’000 At fair value Money Market Securities: Treasury bills Islamic Treasury bills Malaysian Government Securities Malaysian Government Investment Certificates Cagamas bonds Cagamas Mudharabah Bearer Bonds Khazanah bonds Negotiable Islamic debt certificate Negotiable instruments of deposit Islamic Bank Negara Monetary Notes Bank Negara Monetary Notes The Bank 2009 2008 RM’000 RM’000

999,652 4,065 991 1,004,708

26,566 78,224 160,705 323,014 25,057 37,167 59,359 313,742 15,368 134,107 274,645 1,447,954

999,652 4,065 1,003,717

26,566 160,705 287,793 25,057 35,076 45,857 15,368 134,107 274,645 1,005,174

Quoted Securities: Shares and unit trust in Malaysia Quoted Securities: Shares outside Malaysia Unquoted Securities: In Malaysia Private debt securities Guaranteed private debt securities Outside Malaysia Private debt securities

20,294 20,294 -

82,534 82,534 69,236 69,236

20,294 20,294 -

82,464 82,464 69,236 69,236

347,004 15,405 362,409

4,635,070 325,058 123,887 5,084,015

144,133 15,405 159,538

4,518,439 325,058 123,887 4,967,384

Total securities held-for-trading

1,387,411

6,683,739

1,183,549

6,124,258

47

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

014 4.880 65.372 91.762 22.563 1.446 5.090 69.427 133.855 131.014 4.990 29.429 12.855 65.090 12.534 95.387 78 78 36.817 6.090 12.682.153.056.145 42.762 69.096 94.145 42.945 96.762 69. 8515–D 8.387 78 78 Unquoted Securities In Malaysia: Private debt securities Guaranteed private debt securities 4.945 70.039 332 3.053.271 48 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .534 96.371 309.446 4.855 130.877.096 94.878 130.598.152.529 1.168 5.897 1.331.373.Company No.056.063 4. SECURITIES AVAILABLE-FOR-SALE The Group 2009 2008 RM’000 RM’000 At fair value: Money Market Securities: Islamic Khazanah Bonds Negotiable instruments of deposit Negotiable Islamic debt certificate Malaysian Government Investment Certificates Quoted Securities In Malaysia: Shares Shares/Bonds with options and/or collateral Corporate bonds Loan stocks Quoted Securities Outside Malaysia: Shares The Bank 2009 2008 RM’000 RM’000 36.878 65.190 36.878 65.090 69.632 1.025 130.411 9.150 91.186.467 12.166 Unquoted Outside Malaysia: Shares Private Debts Securities 1.817 6.817 1.484 1.762 22.411 9.878 Total securities available-for-sale 5.451 309.025 173.001 332 3.330.

118 (382.920 427.407 204.444 1.503 406.441 196.989 191.119 936.956 90.008 Unquoted Securities Outside Malaysia: Private debt securities Shares Total Less: Accumulated impairment losses Total securities held-to-maturity 17 17 1.359 (477.Company No.074) 753.113 15 251.684 190.407 204. SECURITIES HELD-TO-MATURITY The Group 2009 2008 RM’000 RM’000 At amortised cost Quoted Securities In Malaysia: Shares Debt securities with options and/or collateral Warrants Debt securities The Bank 2009 2008 RM’000 RM’000 40 160.180 21.185.220 49 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .886) 710.291 - - - 92.441 196.061 631.741 121 218.579.538) 1.772 1.249 126.220 16 86.337 493.876 218 251.074 17 17 1.151 56.634.346 40 159.202 15 218.164.804 143.876 1.685 493.825 161.542 813 203.444 1.536 (358.156.445 350.798 (463.338 Quoted Securities outside Malaysia: Debt securities Unquoted Securities In Malaysia: Shares Debt securities Debt securities with options and/or collateral 7.470 324.331 6.592 631.772 1.115.135.433 190.971 813 203.119 907.926 126.754) 1.346 107.847 30.331 6.069.364 The Group 2009 2008 RM’000 RM’000 Market value Quoted Securities: Shares Debt securities with options and/or collateral Debt securities The Bank 2009 2008 RM’000 RM’000 16 87. 8515–D 9.

The default classification for derivative financial instruments is trading. The table below shows the Group’s and Bank’s derivative financial instruments as at the balance sheet date.495.772 6.861 100. interest rates and security prices) of the underlying instruments.695 - 3. unless designated in a hedge relationship and are in compliance with the hedge effectiveness criteria.154 194. modify or reduce their foreign exchange and interest rate risks via hedge relationships.100 26.132 170.650 26.756 13.988.154 3. as well as management’s policy for controlling these risks are set out in Note 54.538 49.Interest rate futures Cross currency swaps Hedging Derivatives Interest rate related contracts .131.678 565.231 76.000 624.134 307.Interest rate swaps .441.651 352.448 6.Written options Interest rate related contracts .647 104. The Bank also transacts in these instruments for proprietary trading purposes.552 11.Company No.507 607 329.894 Equity related contracts .867 - 100 19.007 50 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . DERIVATIVE FINANCIAL ASSETS/LIABILITIES Derivative financial instruments are off-balance sheet financial instruments whose values change in response to changes in prices or rates (such as foreign exchange rates.762.341 60. 8515–D 10.861 5.673 1.907 126.940 141.899 29.574 106.098 477.213 341.483 639.191 44.624. These instruments allow the Bank and its customers to transfer.Purchased options .307 270.012 45.000 33. The risks associated with the use of derivative financial instruments.Currency forward 824.658 4. The contractual or underlying principal amounts of these derivative financial instruments and their corresponding gross positive (derivative financial asset) and gross negative (derivative financial liability) fair values at balance sheet date are analysed below: 2009 The Group 2008 Contract/ Notional Amount RM'000 Positive Fair Value RM'000 Negative Fair Value RM'000 Contract/ Notional Amount RM'000 Positive Fair Value RM'000 Negative Fair Value RM'000 Trading Derivatives Foreign exchange contracts .000 610.Interest rate swaps Total 194.

660 149.772 6.000 610.552 11.894 Equity related contracts .231 76.940 141.441.861 5.448 6.538 49.867 - 100 19.000 624.600 639.762.Currency forward 824.) 2009 The Bank 2008 Contract/ Notional Amount RM'000 Positive Fair Value RM'000 Negative Fair Value RM'000 Contract/ Notional Amount RM'000 Positive Fair Value RM'000 Negative Fair Value RM'000 Trading Derivatives Foreign exchange contracts .651 352.Written options Interest rate related contracts .507 607 329.341 60.406.012 45.100 26.Company No.134 307.247 170.000 33.988.899 29.Purchased options .Interest rate swaps .307 270.098 475.574 106.678 563. DERIVATIVE FINANCIAL ASSETS/LIABILITIES (CONTD.650 26.647 104.624.213 341.658 4.191 44.660 1.810 - 1.673 1.873 100. 8515–D 10.Interest rate futures Cross currency swaps Hedging Derivatives Interest rate related contracts .131.873 13. 51 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .007 Fair values of derivative financial instruments are normally zero or negligible at inception and the subsequent change in value is favourable (assets) or unfavourable (liabilities) as a result of fluctuations in market interest rates or foreign exchange rates relative to their terms.907 126.Interest rate swaps Total 149.

984.197.143.520 9.700) (815.169 35.519 10.322.859) 52.238.985.929 6.371 1.407) 44.886 (684.General (Note 11(vii)) .800.137 - 58.485.137 (895.456.231 156.785.762 279.250 (728.379 3.502.126 14.735.632.199.448 10.491.254 159.Specific (Note 11(vii)) Net loans.195.444.152 22. advances and financing is as follows: 9.605.581 (6.607 (3.351.524 325.767 159.609.871 2.899.444.805) 56.118.021.519 1.143 The maturity structure of loans.432 12.895 1.235 (905.538 11.486 1.966 (6.473 54.261.030) (1.606.296 11.253 33.409.338 341.325.499.892 3.491.810 4.952.406 58.776.626 5.355 29.550. advances and financing Allowance for bad and doubtful debts and financing: .139 8.514.302 30.791 6.118.470.529.348. advances and financing (i) 1.424.346) 59.933) 46.395 1.193 30.968 2.058 52.757.093.314.350 4.505 47.792 (840.954 49.756 28.514.623.022) The Bank 2009 2008 RM’000 RM’000 1.347.855. LOANS.955 46.283.623. 8515–D 11.556.435.118.550.435 5.470) 46.231 8.754.615. advances and financing 52 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .519 46.753.364 22.006) 48.301.956.759 8.Company No.139 48.525 (3.631 66.602 10.927.432 54.985) 56.003 2.015.451 62.161 (1.162 48.803) 1.658.885 29.270 12.518 155. ADVANCES AND FINANCING The Group 2009 2008 RM’000 RM’000 Overdrafts Term loans facilities: Housing loans/financing Hire-purchase receivables Other loans/financing Card receivables Bills receivables Trust receipts Claims on customers under acceptance credits Revolving credits Staff loans Total Unearned interest and unearned income Less: Islamic financing sold to Cagamas Berhad Gross loans.939.137 Maturing within one year One year to three years Three years to five years Over five years Gross loans.444.482.077 1.237 3.739.994.587) (1.442 373.655) (914.973.138 25.997 1.694 5.368.417.961.867.336.912 45.

931.Others Government and statutory bodies Individuals Other domestic entities Foreign entities Gross loans.519 131 832.861.543.506 38.746.037 500.667.566 216.118.096.197.Cost plus .047 20. advances and financing The Bank 2009 2008 RM’000 RM’000 2.668 1.Company No.514.198 4.023 23.Housing loans/financing .739.852 450.791 4.634 18.Other fixed rate loan/financing Variable rate . advances and financing 757.104.139 The Bank 2009 2008 RM’000 RM’000 753.281.581 36.444 5.372.134 4.Other variable rates Gross loans.528. advances and financing analysed by interest/profit rate sensitivity are as follows: The Group 2009 2008 RM’000 RM’000 Fixed rate .343.037 481.Small medium enterprises .992 11.118.883 46.514.181.384 199.444.139 1. advances and financing analysed by type of customer are as follows: The Group 2009 2008 RM’000 RM’000 Domestic banking institutions Domestic non-bank financial institutions Domestic business enterprises .363 24.418 10.555 69.427 8.486.648.228.736 54.447.630 15.273 468.137 (iii) Loans.217.449 14.985 14.881 111.113 20.373 54.432 2.Base lending rate plus .270 29.047.032.444.550.430.698.031 29.116.055.) (ii) Loans.510 19.959 69.923.137 53 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .344.038 7.550 6.687.243.162.360 58.046 32.432 131 832.506 30. ADVANCES AND FINANCING (CONTD.025 7.872 48.519 1.076 46.488 48.741.183.Hire purchase receivables .695 5. 8515–D 11.550.766 11.821 1.693 90.337.344 58.192 8.795 5. LOANS.674 15.528 5.688.973 12.

661 56.875 17.313 2.118.794 55.581.413 3.Non-Residential Purchase of fixed assets other than land and building Personal use Credit card Purchase of consumer durables Construction Working capital Other purpose 60.501 924.470.492 3. 8515–D 11.892 838.678 11.Company No.568 2.777 176.361 2.484 2.459 332.347.956 419.815.785 334.060.498 1.593 2.159 346.456.444.519 46.161 1.878.444.160.123 10.418 305.923.081 18.655.215.756 18.356 2.203 8.949 303.021 1. advances and financing analysed by loan purpose are as follows: The Group 2009 2008 RM’000 RM’000 Purchase of securities Purchase of transport vehicles Purchase of landed property .351.616 304.124.707 881.406.393 19.756.862 428.832 346.898.667 59.209 550 148.139 48.680 46.018.664.163 70.595.276 941.561 2.726 44.196.519 1.118.291 377.866 The Bank 2009 2008 RM’000 RM’000 1.432 (1.408 1.719 333.560.476 206.127.659 59.137 Non-performing loans analysed by loan purpose are as follows: The Group 2009 2008 RM’000 RM’000 Purchase of securities Purchase of transport vehicles Purchase of landed property .149 304.661 9.684 25.975 1.119 35.085 453.312.363 54 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .292.680 866.092.137 (905.069 809 1.246 66.306.104 2.398 916.615 962.169 The Bank 2009 2008 RM’000 RM’000 59.916 34.980.987. ADVANCES AND FINANCING (CONTD.) (iv) Loans.013 2.Residential .661 8. LOANS.844.535.962 450.131 27.550.022) 54.780 1.369.514 48.837 1.291 24.079.653.708 811.342 2.075 24.Non-Residential Purchase of fixed assets other than land and building Personal use Credit card Purchase of consumer durables Construction Merger and acquisition Working capital Other purpose Less: Islamic financing sold to Cagamas Berhad Gross loans.206.457.883 1.345 1.772 10.432 485 179.017 2.203 9.484 220.803) 58.235 1.353 96.419.672.Residential .089 36.269 43.448 933 1.961 10.016 44.514.756 1.167.630 97.662.339.798. advances and financing (v) 1.956.624 180.733 2.180.011 485 201.114 550 148.

Company No. 8515–D

11.

LOANS, ADVANCES AND FINANCING (CONTD.) (vi) Movements in the non-performing loans, advances and financing ("NPL") (including interest and income receivable) are as follows: The Group 2009 2008 RM’000 RM’000 Gross Balance at beginning of year Non-performing during the year Reclassification to performing loans, advances and financing Amount recovered Debt equity conversion Amount written off Sale of non-performing loans Factored loan from related company Repurchase of loan Reclassification from trade receivables Exchange fluctuation adjustment Balance at end of year Less: Specific allowance Non-performing loans, advances and financing - net Gross loans, advances and financing Add: Islamic financing sold to Cagamas Berhad Balance at end of year Less: Specific allowance Net loans, advances and financing (including Islamic financing sold to Cagamas Berhad) Ratio of non-performing loans, advances and financing to total loans, advances and financing (including Islamic financing sold to Cagamas Berhad) - net The Bank 2009 2008 RM’000 RM’000

3,292,684 1,165,774

5,152,411 1,319,462

2,987,363 979,558

4,649,327 1,113,394

(577,415) (383,387) (933) (1,293,281) 196,730 19,554 2,419,726 (914,985)

(757,158) (513,158) (86,725) (1,274,107) (547,859) 33 (215) 3,292,684 (1,348,859)

(514,983) (355,769) (933) (1,131,431) 196,730 19,554 2,180,089 (815,933)

(653,641) (442,281) (86,725) (1,044,670) (547,859) 33 (215) 2,987,363 (1,195,407)

1,504,741

1,943,825

1,364,156

1,791,956

58,550,432

54,514,139

48,444,519

46,118,137

905,803 59,456,235 (914,985)

1,956,022 56,470,161 (1,348,859)

48,444,519 (815,933)

46,118,137 (1,195,407)

58,541,250

55,121,302

47,628,586

44,922,730

2.57%

3.53%

2.86%

3.99%

55

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

11.

LOANS, ADVANCES AND FINANCING (CONTD.) (vii) Movements in the allowance for bad and doubtful debts and financing are as follows: The Group 2009 2008 RM’000 RM’000 General Allowance Balance at beginning of year Allowance made during the year (Note 40) Allowance vested from related company not charged to Income Statement Exchange fluctuation adjustments Balance at end of year % of net loans, advances and financing (including Islamic financing sold to Cagamas Berhad) Specific Allowance Balance at beginning of year Allowance made during the year (Note 40) Amount written back in respect of recoveries (Note 40) Net charge to income statements Debt equity conversion Amount written off/ Adjustment to Asset Deficiency Account Factored loan from related company Repurchase of loan Reclassification from / (to) trade receivables Sale of non-performing loans Balance at end of year The Bank 2009 2008 RM’000 RM’000

840,030 51,102 4,462

774,202 66,062 -

684,587 39,651 4,462

633,446 51,375 -

61 895,655

(234) 840,030

728,700

(234) 684,587

1.53%

1.52%

1.53%

1.52%

1,348,859

2,083,016

1,195,407

1,829,318

1,042,014

1,181,796

885,471

964,117

(377,380) 664,634 (933)

(413,905) 767,891 (17,190)

(329,236) 556,235 (933)

(335,005) 629,112 (17,190)

(1,233,739) 118,730 17,508 (74) 914,985

(1,265,864) 838 (219,832) 1,348,859

(1,071,077) 118,730 17,508 63 815,933

(1,026,839) 838 (219,832) 1,195,407

56

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

12.

OTHER ASSETS The Group 2009 2008 RM’000 RM’000 Deferred assets Other receivables, deposits and prepayments (net) Amount due from originators Amount recoverable under asset-backed securitisation transaction net of impairment loss of RM Nil (2008: RM30,500,000) Foreclosed properties net of impairment loss of RM97,950,000 (2008: RM91,724,000) 34,744 514,757 25,789 39,891 565,668 35,140 The Bank 2009 2008 RM’000 RM’000 34,744 410,686 25,789 39,891 484,844 35,140

-

67,066

-

67,066

178,748 754,038

99,772 807,537

178,748 649,967

99,772 726,713

The Group and The Bank 2009 2008 RM’000 RM’000 (i) Deferred Assets Arising from takeover of Kewangan Usahasama Makmur Berhad

34,744

39,891

In 1988, the Bank took over the operations of Kewangan Usahasama Makmur Berhad (“KUMB”), a deposit taking co-operative in Malaysia. The Government of Malaysia granted to KUMB a future tax benefit amounting to RM434 million; subsequently adjusted to RM426.69 million upon finalisation of KUMB’s tax credit in consideration of the deficit in assets taken over from deposit taking co-operatives. The tax benefit is a fixed monetary sum and is not dependent on any changes in tax rates. The net tax benefit is shown as a deferred asset and the utilisation of the deferred tax benefit is based on the receipt of notices of assessment and subsequent remission of the tax liabilities by the relevant authority net of the amount payable to the tax authorities for purposes of Section 108 tax credit. (ii) Included under the gross amount of other receivables, deposits and prepayments of the Group and Bank are outstanding balances totalling RM10,869,000 (2008: RM552,000) and RM15,382,000 (2008: RM18,835,000) respectively owing by other related companies. These amounts are interest-free and represent amounts paid on behalf.

(iii) Other receivables, deposits and prepayments are net of allowance for doubtful debts of the Group and Bank which amounted to RM22,607,000 (2008: RM18,969,000) and RM8,284,000 (2008: RM16,658,000) respectively. (iv) Amount due from originators represent loans, hire purchase and leasing receivables acquired from Originators for onward sale to Cagamas Berhad as mentioned in Note 22.

57

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Company No. 8515–D

13.

STATUTORY DEPOSIT WITH BANK NEGARA MALAYSIA The non-interest bearing statutory deposit is maintained with Bank Negara Malaysia in compliance with Section 37(1)(c) of the Central Bank of Malaysia Act, 1958 (Revised 1994), the amounts of which are determined as a set percentage of total eligible liabilities.

14.

INVESTMENT IN SUBSIDIARY COMPANIES The Bank 2009 2008 RM’000 RM’000 Unquoted shares at cost Accumulated Impairment losses Net 975,026 (125,156) 849,870 856,869 (10,000) 846,869

(a)

Incorporation of new subsidiaries During the financial year, the Bank had incorporated two new wholly-owned subsidiaries, as follows: (i) AmPremier Capital Berhad - incorporated on 26 December 2008 as a special purpose vehicle to facilitate the issuance of the Non-Innovative Tier 1 capital. As at 31 March 2009, 2 ordinary shares of RM1.00 each were issued for cash at par, amounting to RM2. AmMortgage One Berhad - incorporated on 12 February 2009 as a special purpose vehicle to undertake the proposed acquisition of a third party's employee mortgage loans. As at 31 March 2009, 1,000 ordinary shares of RM1.00 each were issued for cash at par, amounting to RM1,000.

(ii)

(b)

Subscription of additional shares in subsidiary companies During the financial year, the Bank had subscribed to the following ordinary shares issued by its subsidiary companies for cash at par: Number of shares '000 Bougainvillaea Development Sdn. Bhd. MBf Equity Partners Sdn. Bhd. Natprop Sdn. Bhd. Teras Oak Pembangunan Sdn. Bhd. Komuda Credit & Leasing Sdn. Bhd. AmCredit & Leasing Sdn Bhd Li & Ho Sdn. Bhd. Annling Sdn. Bhd. MBf Nominees (Asing) Sdn. Bhd. Malco Properties Sdn. Bhd. Lekir Development Sdn. Bhd. Crystal Land Sdn. Bhd. 10,000 1,284 71,509 3,500 13,759 3,392 4,058 3,096 138 259 3,799 3,362 118,156 Cost of Investment RM'000 10,000 1,284 71,509 3,500 13,759 3,392 4,058 3,096 138 259 3,799 3,362 118,156

Par Value RM 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00

58

AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009

Malaysia Labuan. MBf Equity Partners Sdn. Bhd.0 81. Teras Oak Pembangunan Sdn. Everflow Credit & Leasing Corporation Sdn. MBf Nominees (Asing) Sdn. Bhd. Bhd. Bougainvillaea Development Sdn.0 100. AmCredit & Leasing Sdn Bhd Li & Ho Sdn. Bhd.0 100. Bhd.0 100. Crystal Land Sdn.0 100.0 100. 8515–D 14.0 100. Bhd.0 100.0 100. Bhd.Company No.0 100.0 100.0 100. Bhd.0 100.0 97.0 100.0 100.0 100. Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Islamic Banking Trade finance services Offshore banking Special purpose vehicle Special purpose vehicle Special purpose vehicle Special purpose vehicle Property investment Property investment Renting of computer equipment and provision of related support services Trustee services Nominee services Dormant Dormant Dormant Dormant Dormant Dormant Dormant Dormant Dormant Dormant Dormant Dormant Dormant MBf Trustees Berhad MBf Nominees (Tempatan) Sdn.0 100. Bhd.0 100.0 100.0 100.0 80.0 100.0 100. Bhd.) Details of the subsidiary companies are as follows: Country of Incorporation Effective Equity Interest 2009 2008 % % 100.0 100. INVESTMENT IN SUBSIDIARY COMPANIES (CONTD. Bhd. Bhd. Bhd.5 100.0 100.0 100.9 100.0 100.0 100.0 60. Komuda Credit & Leasing Sdn.0 Name of Company Principal Activities AmIslamic Bank Berhad AmTrade Services Ltd * AmInternational (L) Ltd AMBB Capital (L) Ltd AmCapital (L) Inc AmPremier Capital Berhad AmMortgage One Berhad AmProperty Holdings Sdn.0 100. Bhd.0 100. MBf Information Services Sdn.0 100.0 100.0 * Audited by an affiliate of Ernst & Young 59 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .0 100. Bhd.0 100. Bhd. Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia Malaysia 60.0 100. Malaysia Labuan.0 100. Annling Sdn. Natprop Sdn.0 100.0 100.0 100. Malaysia Hong Kong Labuan.0 100.0 100. Malco Properties Sdn. Lekir Development Sdn.0 51. Economical Enterprises Sdn.

648 6.Company No.837 4. at cost Less: Impairment loss 100 100 100 100 The Bank 2009 2008 RM’000 RM’000 150 (13) 137 150 (13) 137 Share of post-acquisition results.189 348 60 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .501 2. net of tax 705 805 640 740 137 137 The associated companies.891 610 8.560 823 7. 8515–D 15. INVESTMENT IN ASSOCIATED COMPANIES The Group 2009 2008 RM’000 RM’000 Unquoted shares. The summarised financial information of the associate are as follows: The Group 2009 2008 RM’000 RM’000 Assets and liabilities Current assets Non-current assets Total assets Total liabilities Results Revenue Profit for the year 7. which are incorporated in Malaysia are as follows: Principal Activity AmTrustee Berhad MBf Trustees Berhad The effective equity interests are as follows: The Group Effective Equity Interest 2009 2008 AmTrustee Berhad MBf Trustees Berhad 20% 60% 20% 60% The Bank Effective Equity Interest 2009 2008 20% 20% 20% 20% Trustee Services Trustee Services The investment in MBf Trustees Berhad is classified as investment in subsidiary company at Group level through additional equity interests held by two subsidiary companies.383 1.190 327 4.

551 831 254 1.297 254 1.312 239 239 1.721 139 2.249 NET BOOK VALUE As at 31 March 2009 3.109 970 254 88 1.249 Analysed as: Accumulated amortisation Accumulated Impairment loss 1.602 3.860 The long term leasehold properties for the Group and the Bank are for lease periods of 66-999 years and 85-855 years respectively and with unexpired lease periods of 52-873 years and 61-786 years respectively. 8515–D 16.198 254 99 1. The short term leasehold properties for the Group and the Bank are for lease periods of 20-49 years and 20 years respectively and with unexpired lease periods of 0-32 years. 61 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .756 295 4.551 758 254 73 1.Company No.051 2.312 228 11 239 1.068 534 5.085 158 6 164 916 254 79 1.058 254 1.085 164 164 995 254 1. PREPAID LAND LEASE PAYMENTS <--------------------The Group-------------------> Long term Short term leasehold land leasehold land Total RM'000 RM'000 RM'000 COST As at 1 April 2008 ACCUMULATED AMORTISATION/ IMPAIRMENT LOSS As at 1 April 2008 Impairment loss Amortisation charge for the year As at 31 March 2009 <----------------------The Bank---------------------> Long term Short term leasehold land leasehold land Total RM'000 RM'000 RM'000 5.806 303 4.

8515–D 16. PREPAID LAND LEASE PAYMENTS (CONTD.198 682 76 758 149 9 158 831 85 916 As at 31 March 2008 NET BOOK VALUE As at 31 March 2008 4.098 306 4.048 145 3.068 534 5.806 303 4.602 3.404 3.) <--------------------The Group-------------------> Long term Short term leasehold land leasehold land Total RM'000 RM'000 RM'000 COST As at 1 April 2007 ACCUMULATED AMORTISATION As at 1 April 2007 Amortisation charge for the year <----------------------The Bank---------------------> Long term Short term leasehold land leasehold land Total RM'000 RM'000 RM'000 5.193 62 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .Company No.093 105 1.109 879 91 970 214 14 228 1.

964) 331 (828) 821.069 648.069 612.828 156.391 12.359 340.628 314 886 4.359 119.218 156.350 1.782 12.443) (3.853 Leasehold buildings RM’000 17.300 355.868 4.224 Total RM’000 782.359 355.685 Motor vehicles RM’000 8.514 156.462 3.147 (106) (64) 186.063 82.300 6.491) 38 8.188 30.756 (1.155 171. furniture and fittings RM’000 131.350 7.016 Leasehold improvements RM’000 179.350 2.300 6.659 (24.897 15.059 455 (103) 13 38 7.441 1.638 17.462 3.945 488 (1.218 110.350 7.586 Analysed as: Accumulated depreciation Accumulated impairment loss 1.385 2.127 (332) 58 22.942 886 4.620 9.828 143.443) (1.364) 44 (33) 355.586 NET BOOK VALUE As at 31 March 2009 11.463) 2.Company No.364) (360) 45 (756) 437. PROPERTY AND EQUIPMENT The Group Freehold land RM’000 COST As at 1 April 2008 Additions Reclassified to intangible assets (Note 18) Disposals Reclassification Exchange differences Written-off As at 31 March 2009 ACCUMULATED DEPRECIATION AND IMPAIRMENT LOSSES As at 1 April 2008 Depreciation for the year Disposals Impairment loss Exchange differences Reclassification As at 31 March 2009 Freehold buildings RM’000 23.376 15.236 650.196 63 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .350 1.069 6.892 (166) 12.462 7.559 (24.236 (1.236 254 650.127 68.218 119.704 12.422 Computer equipment RM’000 408.853 38.879 7.016 17.179 (608) 173 (5) 119. 8515–D 17.706 (3.517 (611) 466 190 (8) 136.388) 24 6.726 1.856 Office equipment.904 55.

299 47.433 34.704 36.892 12.248 Computer equipment RM’000 393.806 (178) (141) (2) 612.879 130.883 3.310 318 3.127 6.792 12.439 (16.274 167 8.897 68.388 Leasehold improvements RM’000 169.969) (181) (131) (1.842 363 179.892 12.) The Group Freehold land RM’000 COST As at 1 April 2007 Additions Reclassified to Intangible assets (Note 18) Disposals Exchange differences Written-off As at 31 March 2008 ACCUMULATED DEPRECIATION As at 1 April 2007 Depreciation for the year Disposals Exchange differences Written off As at 31 March 2008 NET BOOK VALUE As at 31 March 2008 Freehold buildings RM’000 23.127 575.068 Leasehold buildings RM’000 17.628 13. PROPERTY AND EQUIPMENT (CONTD.595 13.892 64 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .274 12.597 462 7.674 9.127 23.853 169.945 1.Company No.016 3.186 (181) (105) 85 131.368 37.403 556 (14) 6.175 Office equipment.620 21.007 Motor vehicles RM’000 8.969) (26) (1.496 Total RM’000 753. furniture and fittings RM’000 128.244 (16.868 99.441 6.330) 782.109 143.059 16.016 17. 8515–D 17.904 328.778) 408.132 (25) (2) 340.671 11.229 (178) (102) 110.

471 156.236 640.607 130.888 274 886 4.087 146.082 117.082 156.831 5.055 13.055 3.350 1.162 886 4.350 1.443) (3.236 (1.582 3.001 82.048 143.513 (611) 593 (1) 134.831 638.886 354.886 6.765 454 (1.730 30.) The Bank Freehold land RM’000 COST As at 1 April 2008 Additions Reclassified to Intangible Assets (Note 18) Disposals Reclassification Written-off As at 31 March 2009 ACCUMULATED DEPRECIATION AND IMPAIRMENT LOSSES As at 1 April 2008 Depreciation for the year Disposals Impairment loss As at 31 March 2009 Freehold buildings RM’000 Leasehold buildings RM’000 Leasehold improvements RM’000 Office equipment.564 15.778 179.599 Analysed as: Accumulated depreciation Accumulated impairment loss 1.638 7.142 (608) 117.687 1.918 746.942 68.796 408.587 (24.951 8.886 5.088 65 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .388) 5.139 (106) (64) 186.443) (1. furniture and fittings RM’000 Computer equipment RM’000 Motor vehicles RM’000 Total RM’000 3.778 13.599 NET BOOK VALUE As at 31 March 2009 2.582 3.350 561 46 607 2.302 4.360) 2.414 55.525 17.048 156.475 (24.466) (821) 786. PROPERTY AND EQUIPMENT (CONTD.448 9.261 9.491) 7.611 12. 8515–D 17.173 1.065 2.082 109.795 117.686 (1.831 603.795 340.236 640.Company No.650 38.795 354.364) 354.232 2.363 2.073 (3.350 607 607 3.364) (487) (756) 436.

765 566.582 As at 1 April 2007 Depreciation for the year Disposals As at 31 March 2008 - 514 47 561 2.261 328.Company No.060 143. 8515–D 17.611 98.433 9.850 1.942 3.239 526 6.489) (181) (1.489) (1.) The Bank Freehold land RM’000 COST As at 1 April 2007 Additions Reclassified to Intangible Assets (Note 18) Disposals Written-off As at 31 March 2008 ACCUMULATED DEPRECIATION Freehold buildings RM’000 3.842 363 179.610 278 2.408 143.302 Computer equipment RM’000 392.076 (181) 85 130.890 36.160 (16.041 67.322 3.564 6.582 3.006 167 8.245 (16.268 11.027 21.778 Leasehold improvements RM’000 169.638 Office equipment.494 10.773) 408.466 12.098 340.325) 746.516 34.778 13.171 (178) 109.180 (178) 603.055 Leasehold buildings RM’000 13.582 2.650 NET BOOK VALUE As at 31 March 2008 3.292 66 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .414 Motor vehicles RM’000 8.888 130.551 13.173 Total RM’000 717.055 3.648 37. PROPERTY AND EQUIPMENT (CONTD. furniture and fittings RM’000 127.692 47.

) Included in the net book value of computer equipment and leasehold improvements are capital work-in-progress for the Group and the Bank of RM 30.467 66.792 4.335 93. INTANGIBLE ASSETS The net carrying amount of intangible assets are as follows: The Group 2009 2008 RM’000 RM’000 Computer Software Cost At the beginning of the year Additions Reclassified from computer equipment (Note 17) Exchange differences At the end of the year The Bank 2009 2008 RM’000 RM’000 167.906 310.470 5.181 60. 8515–D 17. furniture and fittings Computer equipment Motor vehicles 120.846 85. Details of fully depreciated property and equipment of the Group and the Bank.627 501.564 16.534 18.489 167.589 106.592 20.682 (2) 106.876 67 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .104 10.960.057 4.193 65.306 24.039 140.792 167. (a) PROPERTY AND EQUIPMENT (CONTD.969 (2) 167.898 75 102 108.Company No.626 20.639 24.960 315.777 310.871 532.161 130.470 4.776 5.499 499.776 5.000).017 534.778 75 102 108.539 24.181 24.012 130.800 (2008: RM30.597 92.443 196.178 The Bank 2009 2008 RM’000 RM’000 119.407 85.721 16.874 140.821 75.306 61. which are still in use are as follows: (b) The Group 2009 2008 RM’000 RM’000 Freehold building Leasehold building Leasehold improvements Office equipment.956 315.176 74.345.004 10.443 196.486 106.057 Accumulated Amortisation At the beginning of the year Amortisation for the year Exchange differences At the end of the year Net Book Value 106.

532 2.741 The Bank 2009 2008 RM’000 RM’000 2.363 42.888 53.339 2.634.135 43.219 12.827 10.570 7.901 876.387.741 41.802.870.341.272 984.396 8.092 10.845 2.460 3.867 68 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .575.217. DEPOSITS FROM CUSTOMERS The Group 2009 2008 RM’000 RM’000 Demand deposits Savings deposits Other deposits Fixed/Investment deposits Negotiable certificates of deposits 3.208.769.845 37.030.749.810 1.481 55.539.810.135 23.592 2.619.934 825.896 2. 8515–D 19.310.581.196 48.897 35.806 20.908.521 3.164 48.199.870.726 1.027.307 1.510.773 897.010.341.199.199.409 63.088 48.905.029.867 (i) The maturity structure of deposits from customers is as follows: Due within six months Six months to one year One year to three years Three years to five years 50.867 (ii) The deposits are sourced from the following types of customers: Individuals Business enterprises Government and other statutory bodies Others 25.230.741 23.Company No.162.041 55.516 8.845 22.067 5.394.947.423.900.245 20.947.887 55.500.811 7.270 63.704 9.635.269 12.675 6.138.619.217.747 43.686 5.689 16.982.719.522.341.025 53.814 1.217.363 36.619.998.878.436 2.226.294 558.224 26.809 572.562 2.551.947.168.370.455.656 2.135 2.815.714 63.072 642.828.839.729 53.294.

970.000 493.666 7.406 1.758 1.Company No.709.231.325 4.947 905.000 bears an interest of 1% (2008: 1%) per annum and the soft loans are interest free.641.200.537.632 2.645.019 803.135 716.540.830 1.866 The Bank 2009 2008 RM’000 RM’000 1. 69 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .867 1.759 3. 8515–D 20.000 The soft deposit of RM135.131.810 2.000 The Bank 2009 2008 RM’000 RM’000 135. 21.383.935 1.948.157. The soft loans and soft deposit are repayable when the deferred assets relating to KUMB referred to in Note 12 are fully utilised.140.000 628.376 Included under deposits and placements of other financial institutions of the Group and of the Bank are the following: The Group 2009 2008 RM’000 RM’000 Negotiable instruments of deposits Interbank borrowing (Note 5) The Bank 2009 2008 RM’000 RM’000 2.433.000.000 493.000 628.192 1.340 3.755 1.248 803.325 1.057 1.398 8.302 3.051 793.430.465 908.975 6. BILLS AND ACCEPTANCES PAYABLE Bills and acceptances payable represent the Bank's own bills and acceptances rediscounted and outstanding in the market.422.012.832 1.615 1. The Group 2009 2008 RM’000 RM’000 Soft deposit Soft loans 135.769.721.386.632 3.206 Included under deposits from BNM are long-term deposits and interest-free loans placed with the Group and the Bank in connection with the transfer of certain assets and liabilities of Kewangan Usahasama Makmur Berhad (KUMB) to the Bank as mentioned in Note 12.253.601.000 628.677.744.621.191.000 135.000 135.309 2.000 493.000 493.173 3.237 6.033 1.000 628. DEPOSITS AND PLACEMENTS OF BANKS AND OTHER FINANCIAL INSTITUTIONS The Group 2009 2008 RM’000 RM’000 Licensed banks Licensed investment/merchant banks Licensed financed companies Other Financial Institutions Bank Negara Malaysia ("BNM") 1.537.177.

and to buy back any receivables which are regarded as defective based on prudential criteria with recourse against the Originators.757.367 55.961.000) respectively owing to other related companies. the Bank acts as the intermediary financial institution and undertakes to administer the receivables on behalf of Cagamas Berhad.960 50.384.729 Included under other creditors and accruals of the Group and of the Bank are outstanding balances totalling RM10.807 4 1.436 748. 70 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .130 40 1.676 1.402 The Bank 2009 2008 RM’000 RM’000 382.000) and RM9.Company No.941 601 34 1.242 388. Under this arrangement for loans sold by the Bank.153 816.357.811 37.186. 23.958 965.218.000 (2008: RM4. which are regarded as defective based on prudential criteria with recourse to the Bank. The amounts are interest-free and represent amounts paid on behalf. OTHER LIABILITIES The Group 2009 2008 RM’000 RM’000 Interest payable Other creditors and accruals Profit equalisation reserve Lease deposits and advance rentals Provision for commitment and contingencies Provision for zakat Provision for taxation 442.497.891 55.739 340. Under the back to back arrangement with the Originators.000 (2008: RM2.259 1. RECOURSE OBLIGATION ON LOANS SOLD TO CAGAMAS BERHAD Recourse obligation on loans sold to Cagamas Berhad represents the proceeds received from the Bank's loans sold directly and indirectly or those acquired from the Originators (as disclosed in Note 12) (excluding Islamic financing) to Cagamas Berhad with recourse. the Bank undertakes to administer the loans on behalf of Cagamas Berhad and to buy back any loans.972 1.162 62.392 20 1. 8515–D 22.012.498 62.163.

469 (i) The subordinated term loan represents an unsecured loan obtained from a related company.00% per annum or 3% per annum plus yield of 5-year Malaysian Government Securities. the Bank repaid in full the subordinated term loan. 8515–D 24(a) SUBORDINATED TERM LOANS The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Note Subordinated term loans .RM460 million .9% will be charged. the Bank entered into a Supplemental Facility Agreement with AmInvestment Bank Berhad whereby the subordinated term loan was novated to Quanto Assets Bhd.375% per annum for the next 5 years. On 30 September 2008.000 - 460.401. 71 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .853 825. On 19 May 2006.875% per annum for the first 5 years and 7. The interest rate of the subordinated term loan has been fixed at 6. whichever is the higher for the next 5 years.375% to 9.77% per annum from the date of issue to the date of the first call on 27 January 2016.USD 200 million {net of capitalised issuance expense of RM5.875% per annum for the primary period which ends on 30 September 2008 and 7. The term loan is repayable in a lump sum at the end of ten (10) years from the date of drawdown and interest is charged at a rate of 6.Company No.469 1. interest on the loan remains unchanged at 6. a floating rate per annum of 3 month US Dollar LIBOR plus 2.00% to 9. (ii) The subordinated term loan which was on-lent from the proceeds of the issue of the Hybrid Securities as explained in Note 24(b) is for a period of 50 years to mature on 27 January 2056 with an option to make a first call on 27 January 2016.217. In accordance with the new terms of agreement. The term loan was drawndown on 30 September 2003. For interest thereafter to 27 January 2056.000 (ii) - 460.000 (2008: RM6.853 689.149. AmInvestment Bank Berhad for the purpose of supplementing the Bank’s capital adequacy position and it is subordinated to all other liabilities.000 825. a special purpose vehicle.000)} (i) - 460.

The Hybrid Securities may be redeemed in whole but not in part at the option of the issuer (but not the holders) under certain circumstances. (b) The Hybrid Securities are listed on both the Labuan International Financial Exchange Inc. The Hybrid Securities are guaranteed by the Bank on a subordinated basis. 8515–D 24(b) HYBRID SECURITIES The Group 2009 2008 RM’000 RM’000 Non-cumulative Non-Voting Guaranteed Preference Shares .401.77% per annum and thereafter.90% if not redeemed on 27 January 2016.000.853 689. The Hybrid Securities are perpetual securities and have no fixed final redemption date. The gross proceeds of USD200.217.000. AMBB Capital (L) Ltd.000)) The Bank 2009 2008 RM’000 RM’000 825. 72 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .USD200 million (net of capitalised issuance expense of RM5.000 (2008: RM6. The non-cumulative dividends are payable on semi-annual basis.Company No.000 from the issue of Hybrid Securities were on-lent to the Bank in the form of a subordinated term loan on 27 January 2006 for the purpose of supplementing the Bank’s working capital requirements. The salient features of the Hybrid Securities are as follows: (a) The Hybrid Securities bear non-cumulative dividends from the issue date to (but excluding) 27 January 2016 at 6.000 preference shares of USD100. at a floating rate equal to three (3) months US dollar LIBOR plus 2. and the Singapore Exchange Securities Trading Limited and are offered to international institutional investors outside Malaysia.000 each (“Hybrid Securities”).469 - - On 27 January 2006. a wholly-owned subsidiary of the Bank issued USD200.000 Hybrid Tier 1 Capital comprising 2.

Company No.4% per annum. (d) Tranche 6 amounting to RM600 million issued on 9 April 2008 is for a tenor of 15 years Non-Callable 10 years and bears interest at 6.23% per annum. The interest rate of the MTN will step up by 0.at the beginning of the 6th year Tranche 3 . The MTN Programme has a tenor of up to 20 years from the date of the first issuance under the MTN Programme.2% per annum. preceding the maturity date of the MTN.25% per annum.at the beginning of the 8th year Tranche 4 .at the beginning of the 11th year and every anniversary thereafter. ii. 8515–D 25.5% per annum as follows: (a) (b) (c) (d) (e) (f) Tranche 1 . Tranche 2 amounting to RM165 million is for a tenor of 10 years Non-Callable 5 years and bears interest at 5. Tranche 3 amounting to RM75 million is for a tenor of 12 years Non-Callable 7 years and bears interest at 5.2% per annum.at the beginning of the 5th year Tranche 2 .0 billion nominal value MTN Programme whereby the proceeds raised from the MTN Programme had been and will be utilised for the refinancing of existing subordinated debts and for general working capital requirements. 73 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .at the beginning of the 8th year Tranche 6 .at the beginning of the 6th year Tranche 5 . (c) Tranche 4 and 5 totalling RM120 million was issued on 28 March 2008 as follows: i. The salient features of the MTNs issued are as follows: (a) Tranche 1 amounting to RM500 million was issued on 4 February 2008 and is for a tenor of 10 years NonCallable 5 years and bears interest at 5. The MTN issued under the MTN Programme was included as Tier 2 capital under the capital adequacy framework for financial institutions in compliance with the Risk Weighted Capital Adequacy Framework issued by BNM. Tranche 5 amounting to RM75 million is for a tenor of 12 years Non-Callable 7 years and bears interest at 5. The MTN shall be issued for a maturity of up to 20 years as the Issuer may select at the point of issuance provided that no MTN shall mature after expiration of the MTN Programme.4% per annum. Tranche 2 and 3 totalling RM240 million was issued on 14 March 2008 as follows: i. Tranche 4 amounting to RM45 million is for a tenor of 10 years Non-Callable 5 years and bears interest at 5. (b) ii. MEDIUM TERM NOTES The Bank had implemented a RM2.

Subject to the prior approval of BNM.45% to 10. (ii) On 21 December 2006.Company No. The RM200 million Subordinated Bonds was fully redeemed on 30 April 2008. However. SUBORDINATED BONDS The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Note Subordinated bonds . AmIslamic Bank Berhad (AmIslamic Bank) issued the RM400 million Subordinated Sukuk Musyarakah in one lump sum in the format of a 10 year Non-Call 5 year. the Bank may redeem the Subordinated Bonds on 30 April 2008 or on each anniversary date thereafter.000 400. The salient features of the Subordinated Bonds are as follows: (a) The Subordinated Bonds bear interest at 7. The Subordinated Sukuk Musyarakah which has been awarded a long term rating of A2 by Rating Agency Malaysia is not listed on Bursa Securities Malaysia Berhad or on any other stock exchange but is traded and prescribed under the Scripless Securities Trading System maintained by BNM.000 400.000 600. The Subordinated Sukuk Musyarakah qualify as Tier 2 capital of AmIslamic Bank. The Subordinated Sukuk Musyarakah bears an expected profit rate of 4.5% per annum to legal maturity date. 8515–D 26. The interest is payable on a semi-annual basis.95% per annum for the first five years and subsequently at 8.45% per annum. (b) The Subordinated Bonds are for a period of ten years maturing on 30 April 2013. the expected profit rate shall be stepped up by 0.000. AmIslamic Bank may exercise its call option and redeem in whole (but not in part) the Subordinated Sukuk Musyarakah on the 5th anniversary of the issue date or on any anniversary date thereafter at 100% of the principal amount together with the expected profit payments.RM200 million Subordinated Sukuk Musyarakah .000 - 200. at nominal value together with interest accrued to the date of redemption.000 nominal amount of Negotiable Interest-bearing Redeemable Unsecured Subordinated Bonds (“Subordinated Bonds”) for the purpose of increasing the Bank’s capital funds.000 (i) Pursuant to a Trust Deed dated 24 April 2003.RM400 million (i) - 200. 74 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .000 - 200. subject to the prior approval of BNM.000 (ii) 400.80% per annum for the first 5 years and commencing from the beginning of the 6th year from the issue date and at the beginning of every subsequent year thereafter. the Bank issued RM200.

05 per share.5% for the next five years. This term loan bears interest at 0. On 26 March 2009. Pursuant to the completion of AHB's Rights Issue on 15 January 2008. This term loan is for a tenor of one year from drawdown date and repayable in full on maturity date.490 145. STAPLED CAPITAL SECURITIES The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Stapled Capital securities 500. a USD85 million unsecured term loan was vested from AmInvestment Bank Berhad to the Bank.125% per annum above USD LIBOR is for a tenor of 364 days from the drawdown date. EXCHANGEABLE BONDS During the previous financial year.000 500. at an exchange price of RM3.000.590 new ordinary shares in the ultimate holding company. 8515–D 27. a new unsecured term loan of USD20 million was drawndown for working capital purposes. The EB are exchangeable into 188.490 271. Interest will accrue on the EB at a rate of 5% per annum for the first five years and 5. The loan was fully paid on 13 January 2009.000 500.524.Company No. the Bank drawdown another new USD20 million unsecured term loan for working capital purposes.820 271.000 - 75 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . TERM LOANS Note The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Short term loans USD85 million USD40 million (i) (ii) 145. Bank Negara Malaysia has approved the Exchangeable Bonds as Tier 2 capital of the Bank under the capital adequacy framework.820 145.820 271. the Bank issued RM575.490 271.820 145.000 Exchangeable Bonds ("EB") to ANZ Funds Pty Ltd. the EB conversion price was adjusted from RM3. The EB will mature on the 10th anniversary from the date of issue. This term loan bears interest at 0.75% per annum above the lender's cost of funds.490 (i) Pursuant to the Business Transfer Agreement.7% per annum above the lender's LIBOR. 28. (ii) 29. On 13 January 2009.000 - 500. The term loan which was drawndown on 15 January 2008 bears interest at 0. This term loan is for a tenor of one year from drawdown date and repayable in full on maturity date.95 per share.05 per share to RM2.

8515–D 29.) During the financial year. The SubNotes has a fixed interest rate of 9. or any NCPCS distribution date thereafter. 76 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . The SubNotes are redeemable at the option of AmPremier on any interest payment date. They constitute unsecured and subordinated obligations of the Bank. subject to redemption conditions being satisfied. the Bank had issued up to RM 500 million Stapled Capital Securities in two tranches. The Stapled Capital Securities cannot be traded separately until the occurrence of certain Assignment Events. The NCPCS are redeemable at the option of the Bank on the 20th interest payment date or 10 years from the issuance date of the SubNotes. upon approval from BNM and Securities Commission. Upon occurrence of an Assignment Event. the Stapled Capital Securities will unstaple on the 20th interest payment date of 10 years from the issuance date of the SubNotes. The Stapled Capital Securities comply with BNM's Guidelines on Non-Innovative Tier 1 capital instruments. As at 31 March 2009. which are issued by AmPremier Capital Berhad ("AmPremier"). the Stapled Capital Securities will "unstaple". The NCPCS are issued in perpetuity unless redeemed unter the terms of the NCPCS. If none of the Assignment Events as stipulated under the terms of the Stapled Capital Securities occur. which are issued by the Bank and stapled to the Subordinated Notes described below. Claims in respect of the NCPCS rank pari passu and without preference among themselves and with the most junior class of preference shares of the Bank but in priority to the rights and claims of the ordinary shareholders of the Bank. STAPLED CAPITAL SECURITIES (CONTD. (collectively known as "Stapled Capital Securities") The proceeds from the NIT1 program shall be used as working capital. and (b) Subordinated Notes ("SubNotes").Company No. The SubNotes have a tenure of 30 years unless redeemed earlier under the terms of the SubNotes. the NCPCS distribution will not begin to accrue until the SubNotes are re-assigned to the Bank as referred to above.0% per annum. a whollyowned subsidiary of the Bank. the Bank undertook the issuance of Non-Innovative Tier 1 Capital (NIT1) programme of up to RM500 million in nominal value comprising : (a) Non-Cumulative Perpetual Capital Securities ("NCPCS"). which cannot be earlier than the occurrence of Assignment Events as stipulated under the terms of the Stapled Capital Securities. leaving the investors to hold only the NCPCS while ownership of the Sub-Notes will be assigned to the Bank pursuant to the forward purchase contract entered into by the Bank unless there is an earlier occurrence of any other events stated under the terms of the Stapled Capital Securities. The SubNotes rank pari passu and without preference among themselves and with the most junior class of notes or preference shares of AmPremier. However.

The ICULS is for a period of ten years to mature in 2017. Interest shall be payable on the loan stock at the interest rate of 6% per annum. the Bank issued RM150 million Irredeemable Non-Cumulative Convertible Preference Shares ("INCPS") to the holding company. IRREDEEMABLE CONVERTIBLE UNSECURED LOAN STOCKS In the previous financial year. The ICULS was converted to new shares in the Bank and credited as fully paid on the basis of one new share for every Ringgit Malaysia Five (RM5. 77 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . AMFB Holdings Berhad. IRREDEEMABLE NON-CUMULATIVE CONVERTIBLE PREFERENCE SHARES In the previous financial year. the Bank issued RM300 million Irredeemable Convertible Unsecured Loan Stocks ("ICULS") to the holding company. The INCPS are convertible into new ordinary shares of the Bank on the basis of one (1) new ordinary share for every one (1) INCPS held. During the financial year. AMFB Holdings Berhad. 31. 8515–D 30. The ICULS shall be convertible to new shares in the Bank and credited as fully paid on the basis of one new share for every Ringgit Malaysia Five (RM5.000 fully paid ordinary shares of RM1. The INCPS are perpetual securities and do not have a fixed maturity date.00) nominal amount of ICULS tendered.00 each.000. BNM has approved the ICULS as Tier 2 capital of the Bank under the capital adequacy framework.00) nominal amount of ICULS tendered.Company No. The dividend rate will be 6% per annum. AMFB Holdings Berhad exercised its conversion right to convert the entire RM300 million ICULS into 60. BBM has approved the INCPS as Tier 1 capital of the Bank under the capital adequacy framework.

250 2.00 each Balance at beginning of year Issued arising from conversion of ICULS (Note 30) Balance at end of year Preference shares of RM1.386.364 610.000 670.364 610.250 1.364 610.364 150.000 3.500.00 each Balance at beginning/end of year 610.250 2.000 150.250 1.500.000 150.000 78 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .000 3.000 150.00 each 6% Irredeemable Non-Cumulative Convertible Preference Shares of RM1.386.000 150.886.250 2.500.000 3.386.250 2.500.250 1.00 each The Bank 2009 2008 RM’000 RM’000 1.250 Issued and fully paid Ordinary shares of RM1.000 3.000 670.364 610.386.886. 8515–D 32.886.364 60.000 150. SHARE CAPITAL The Group 2009 2008 RM’000 RM’000 Authorised Balance at beginning and end of year Ordinary shares of RM1.000 150.364 60.000 150.364 610.Company No.886.

RESERVES The Group 2009 2008 RM’000 RM’000 Non-distributable Reserves: Share premium Statutory reserve Capital reserve Securities available-for-sale reserve Merger reserve ICULS (Equity component) (Note 30) Exchange fluctuation Cash Flow hedge reserve Total non-distributable reserves Distributable Reserves: Retained profits 1.948 1.454 710.187.153 942.660 680.293 3.844 680.597.060 5.213 1.801.202.492 (2. the Bank would automatically move to the single tier system and the dividends paid would be treated as single tier dividends.Company No. Share premium is used to record premium arising from new shares issued in the Bank.754 The Bank 2009 2008 RM’000 RM’000 Movements in reserves are shown in the statements of changes in equity.485) 1. 1989 and is not distributable as cash dividends. There is minimal tax credit available under Section 108 of the Income Tax Act.232 377. The securities available-for-sale reserve is in respect of unrealised fair value gains and losses on securities available-for sale.904 (91.090) 1. 79 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .909 3.844 849.313.459 (52.975) (188) (91.566 11.792 4.357.478.459 (2.099) 397.898 377.371. The capital reserve of the Group represents reserve arising from the acquisition of AmIslamic Bank Berhad which is accounted for using the merger accounting method.492 (44.443.933 200. Distributable reserves are those available for distribution by way of dividends. The Cash Flow hedge reserve is in respect of unrealised fair value gains and losses on Cash Flow hedging instruments. The statutory reserve is maintained in compliance with Section 36 of the Banking and Financial Institutions Act.262 942.390.106. 1967 to frank the payment of dividends out of the Bank’s distributable reserves as at 31 March 2008.792 3. If the distributable reserves were to be distributed as dividends prior to there being sufficient Section 108 tax credit.708.090) 2.401 200. The exchange fluctuation reserve arises on translation of the Bank's Labuan offshore branch and subsidiary company incorporated in the Federal Territory of Labuan.186.485) 2.655 710.508 4.660 770.363 735. 8515–D 33.

756 (100. of subsidiary companies attributable to shares owned.016 80 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .640 273.484 (94. directly or indirectly other than by the Bank or subsidiary companies.709 307.804.385 (94.804.254 3.529 99. INTEREST INCOME The Group 2009 2008 RM’000 RM’000 Loans and advances . or of net assets.recoveries from NPLs Money at call.799.520 246. MINORITY INTERESTS Minority interests in the Group represent that part of the net results of operations.805.787.186 2.303 (98.068 3.418 49.627 47. 8515–D 34. The movements in minority interests in subsidiary companies are as follows: The Group 2009 2008 RM’000 RM’000 Balance at beginning of year Share in net results of subsidiary companies Balance at end of year 41 (13) 28 57 (16) 41 35.043 272.122 948 3.768 272.882 213.466 213.606 2. deposits and placements with financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Others Net interest suspended Amortisation of premiums less accretion of discounts The Bank 2009 2008 RM’000 RM’000 2.831 99.724.Company No.878.908 303.853 33.264 317.853 31.898.165 330.Interest income other than recoveries from NPLs .954.718.882 110.956.034 279 3.670) 13.606 2.068 3.026 246.539 160 3.450 3.182 1.882 110.916) 7.450 3.670) 13.083 273.355) 7.810.

220 - - 81 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .182 2.038) (19.232 6.495 81.770 1.655 253.414 209.848 30.000 3.564 1.662 6.814 The Bank 2009 2008 RM’000 RM’000 1.944 4.551 40.602 4.855 (24.652.848 30.232 6.551 40.537.057 31.263 81.937) (19.164 1.024.901 1.114 2.439 15.944 45.663 15.015 995 9.692 2.750 173.015 995 9.314 192.180.253) 533.263 46.025.705 5.534.333 61.272 37.051 2.176 15.008 255.333 15.837 15.740 18.Company No.715 214.662 6.865 5.777 26.777 26.000 3.750 173. 8515–D 36.644.459 - - 155. NET INCOME FROM ISLAMIC BANKING BUSINESS The Group 2009 2008 RM’000 RM’000 Income derived from investment of depositors' funds and others Income derived from investment of shareholders' funds Transfer from/(to) profit equalisation reserve Income attributable to the depositors Finance cost The Bank 2009 2008 RM’000 RM’000 809.518) (383.192.057 77.200) 538.215 701. INTEREST EXPENSE The Group 2009 2008 RM’000 RM’000 Deposit from customers Deposits and placements of banks and other financial institutions Recourse obligation on loans sold to Cagamas Berhad Subordinated term loans Subordinated bonds Hybrid securities Medium term notes Exchangeable bonds Irredeemable Convertible Unsecured Loan Stocks Dividends on INCPS Stapled Capital securities Others 1.211 (359.

783 (20.268 4 (37.085 69.134 1.031 157.252 975 3. OTHER OPERATING INCOME The Group 2009 2008 RM’000 RM’000 (a) Fee Income: Commissions Guarantee fees Other fee income The Bank 2009 2008 RM’000 RM’000 54.707 221.109 116.572 5.626) (37.516 1.218) 174.003 158.110 975 2.028 223.549 532 (13.141 343 2.392 188.572 5.523 371.691 477 (12.464) 11.092 54.976) 15.948 18.626) (37.214 7.300 (54.907 774 5.436) 11.842 429 20.976) 15.449 (b) Investment income: Net (loss)/gain on sale/redemption of: Securities held-for-trading Securities available-for-sale Securities held-to-maturity Net loss on revaluation of securities held-for-trading Net (loss)/gain on revaluation of derivatives Gross dividend income from: Securities held-for-trading Securities available-for-sale Securities held-to-maturity Others (54.214 7.598) (122.827 26. 8515–D 38.256 26.691 807 26.593 46.085 69.873 142.631 429 20.907 774 5.929 54.822) (907) (10.599 (c) Other Income: Gain on disposal of foreclosed properties Rental income Gain on disposal of property and equipment Foreign exchange (loss)/gain Other operating income 343 3.Company No.237) (428) (9.792 53.533 376.598) (122.624 118.404) 66.277 24.028 26.629 101.593 46.296 4 (37.414 192.300 (20.057 141.054 19.571 82 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .629 101.028 27.241) 177.735) 64.

166 16.055 (199.550 11.361 37.330 846 1.736 6.905 8.756 24.687 99 24.065 38.073 52. maintenance and security Computerisation cost Amortisation of prepaid land lease payments (Note 16) Amortisation of intangible assets (Note 18) Others Marketing and communication expenses Commission Advertising and marketing expenses Communication Others Administration and general expenses Professional services Others Shared service cost charged Shared service cost recoveries (Subsidiary) The Bank 2009 2008 RM’000 RM’000 411.294 50.247 114.060 79 24.330 44.682 18.494 83. allowances and bonuses Others Establishment costs Depreciation (Note 17) Rental Cleaning.803 19.261 50.428 65.012 19.690 51.562 49. OTHER OPERATING EXPENSES The Group 2009 2008 RM’000 RM’000 Personnel costs Salaries.249 377.others Hire of equipment Auditors' remuneration: Statutory audit Review engagements Reporting accountants Others Property and equipment written off The Bank 2009 2008 RM’000 RM’000 1.442 82.432 38.320 8.806 47.678 6.293) 760.853 7.600 85 20.063 47.248 750 565 440 124 821 679 1.439 83. 8515–D 39.166 85.803 20.266 37.180 48.828 6.047 23.823 7.subsidiary companies .956 50.960 (182.706 51.611 46.161 20.695 38.026 547 390 430 1.637 46.622 52.939 36.718 56.Company No.254 23.325 83 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .493 31.386 51.904 The above expenditure includes the following statutory disclosure: The Group 2009 2008 RM’000 RM’000 Directors' remuneration (Note 43) Rental of premises .950 46.173 40.361 982.589 17.320 16.639) 694.448 61.042 105 20.669 11.522 404.333 931 585 440 124 828 1.795 37.828 902.803 8.924 22.965 450 370 430 1.263 370.191 6.869 45.096 112.085 7.367 42.

OTHER OPERATING EXPENSES (CONTD.written back {Note 11(vii)} General allowance {Note 11(vii)} Bad debts and financing recovered-net Amount recovered from Danaharta The Bank 2009 2008 RM’000 RM’000 1.186) (609) 379.234) 170.102 (366.801. 8515–D 39.692 41.042) (119.942) (2.942) (2.000). contributions to Employees’ Provident Fund and all other staff related expenses.000 (2008: RM58.000) and RM64.746 (58.586) - (75.862) (10.471 (329.005) 51.905) 66.000 (144) (177.796 (413.176) (115. IMPAIRMENT LOSS The Group 2009 2008 RM’000 RM’000 Impairment (loss)/written back: Securities Subsidiary companies Foreclosed properties Property and equipment Prepaid land lease payments Amount recoverable under asset-backed securitisation transaction Sundry receivables The Bank 2009 2008 RM’000 RM’000 (75.made in the financial year {Note 11(vii)} .236) (254) (106. Contributions to Employees’ Provident Fund of the Group and the Bank amounted to RM65. ALLOWANCE FOR LOSSES ON LOANS AND FINANCING The Group 2009 2008 RM’000 RM’000 Allowance for bad and doubtful debts and financing: Specific allowance (net) .014 (377. respectively.908) (10.000 (2008: RM58.375 (300.236) 39.000 3.725) 84 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .181.117 (335.633.236) (254) (106.176) (1.000) (3.651 (425.652 964.000) (3.925. bonuses.330) (609) 517.Company No.139) (119.062 (316. 40.210 1.014 885.156) (1.628) 17.042.129.380) 51.526) 349.) Personnel costs include salaries.586) - 17.

433 1. Related party transactions also includes transactions with entities that are controlled.265 23 114. jointly controlled or significantly influenced directly or indirectly by any key management personnel or their close family members.265 23 115.232 1.747 4.845 2.527 - - - 49 10 199. Key management personnel are the person who have authority and responsibility for planning. Key management personnel of the Group and the Bank are the directors (Executive and Non-Executive) and certain members of senior management of the Bank and head of a major subsidiary company including close members of their families.293 49 182.906 2.639 42 44 31 39 85 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . 8515–D 42. directing and controlling the activities of the Group and the Bank either directly or indirectly. both of which are incorporated in Malaysia. the Group and the Bank had the following transactions with related parties during the financial year: The Group 2009 2008 RM’000 RM’000 Income Related companies Interest on deposits and placement Interest on investment securities Interest on loans advances and financing Other income Subsidiary companies Interest on deposits and placement Interest on investment securities Shared service cost recoveries Key management personnel Interest on loans The Bank 2009 2008 RM’000 RM’000 40. In addition to the transactions detailed elsewhere in the financial statements.747 4.Company No. SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES The holding and ultimate holding companies are AMFB Holdings Berhad and AMMB Holdings Berhad respectively.527 - 40.

593 50 940 1.055 110.218 538 555 306 339 4.662 82.606 52.828 47.066 86 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .763 51.682 521 1.093 25.537 2.538 103 - 18.187 56.818 688.216 119 - 3.261 45. advances and financing 311 542 442 1.818 638.960 - - 49.114 709 1.term funds Deposits and placements Interest receivable Subsidiary companies Deposits and placements Securities available-for-sale Interest receivable Key management personnel Loans. advances and financing Cash and short.285 637.064 405.800 5.662 48.437 99 8.995 6.662 82.285 637.Company No.939 9.727 576 1.361 114.842 18.787 2.995 13.800 5.547 138 682 3.412 9.818 - - 6. SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES (CONTD.844 49.064 405.) The Group 2009 2008 RM’000 RM’000 Expenditure Ultimate holding company Interest on deposits and placements Immediate holding company Interest/Dividend expense Related companies Interest on deposits and placements Shared service costs Subsidiary companies Interest on subordinated loans Interest on deposits and placements Other expenses Associated company Interest on deposits and placements The Bank 2009 2008 RM’000 RM’000 9.939 9. 8515–D 42.218 544 576 306 339 293 511 431 1.895 89 7 74 7 Key management personnel Interest on deposits and placements Information service provider Training Interbank GIRO expenses Short term employee benefits: Salary and other remuneration including meeting allowances Estimated money value of benefits Gratuity Amount due from Related companies Loans.174 167 682 4.

87 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .469 7.791 1.Company No.053 The above transactions have been entered into in the normal course of business and have been established under terms and conditions that are no less favourable than those arranged with independent parties.632.773 129 - 900.143 911 - 2.216 15.704 906 - 1.286 12.348 689.630 825.054 15 100 10 16.421 7.632.853 12.252.241 - - 492.859 8.) The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Amount due to Ultimate holding company Deposits and placements Interest payable Related companies Deposits and placements Interest payable Commitments and contingencies Subsidiary companies Deposits and placements Subordinated term loan Interest payable Associated company Deposits and placements Interest payable Key Management Personnel Deposits and placements 299.773 129 - 299. SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES (CONTD.532 13.619.568 12 100 10 4.928 7.075 8. 8515–D 42.809 4.241 874.

275 303 51 Cuscapi Malaysia Sdn Bhd 11 - The above transactions are the same for both the Group and the Bank except for the following: The Group 2009 2008 RM’000 RM’000 Supplier (Types of transactions) AON Insurance Brokers (M) Sdn Bhd (Brokerage for insurance brokers' services) Harpers Travel (M) Sdn Bhd (Provision of airline ticketing services) The Bank 2009 2008 RM’000 RM’000 305 643 302 643 954 514 916 514 88 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .245 911 399 3. software and related consultancy services Purchase of computer hardware.Company No. 8515–D 42.691 - 6.940 310 1. (M) Sdn Bhd AmProperty Trust Management Bhd Melawangi Sdn Bhd Unigaya Protection Systems Sdn Bhd Gubahan Impian Bursa Malaysia Bhd MCM Systems Sdn Bhd Computer maintenance and consultancy services Computer maintenance and consultancy services Computer maintenance and consultancy services Rental of premises and car park Rental of premises EMV card personalization and fulfillment services Management fees. miscellaneous charges and rental of premises Rental-Amcorp Mall ATM.964 6.) (a) Directors related transactions The significant transactions of the Group and the Bank with companies in which certain directors and/or their close family members are deemed to have a substantial interest.904 279 1. are as follows: Supplier Types of transactions 2009 RM’000 2008 RM’000 MCM Systems Sdn Bhd MCM Horizon Sdn Bhd MCM Consulting Sdn Bhd Dion Realties Sdn Bhd Troost Sdn Bhd Modular Corp. software and related consultancy services Purchase of computer hardware and related consultancy services Purchase of computer hardware. Roadshow Booth Rental and monthly license fee Provision of security services Flower arrangement and hampers Training attendance fee Purchase of computer hardware. software and related consultancy services 6. SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES (CONTD.334 427 149 24 22 355 219 26 - 178 6.696 MCM Consulting Sdn Bhd MCM Horizon Sdn Bhd 892 4.052 342 849 4.

Company No.000 1 1 - 2 2 2 1 1 4 1 89 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .) The Group 2009 2008 RM’000 RM’000 Supplier (Types of transactions) Islamic Banking and Finance Institute Malaysia Sdn Bhd (Seminar attendance fee) AmFirst Real Estate Investment Trust (Rental of premises.063 297 549 846 135 544 679 Total (including benefits-in-kind) 1.001.000 Non-executive director Below RM50.386 1. SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES (CONTD.150.001 .001 . 43.000 RM2.RM2.000 RM50. DIRECTORS’ REMUNERATION Details of remuneration in aggregate for directors charged to the income statements for the financial year are as follows: The Group 2009 2008 RM’000 RM’000 Non-executive directors Fees Other remuneration The Bank 2009 2008 RM’000 RM’000 534 852 1.RM100.RM150.RM1.001 .200. 8515–D 42.300.063 846 679 Directors’ fees for directors who are executives of companies of the Group are paid to their respective companies.000 RM350. The number of directors of the Bank whose total remuneration for the financial year which fall within the required disclosure bands is as follows: Number of Directors 2009 2008 Executive director RM1. management fee and charges) The Bank 2009 2008 RM’000 RM’000 16 7 1 4 19.386 251 812 1. The remuneration for the Chief Executive Officer who is a director of the Bank is paid by a related company and the portion reimbursed by the Bank with effect from the previous financial year is taken up under share of group expenses.000 RM100.RM400.001.000.365 - 18.741 - The above transactions have been entered into in the normal course of business and have been established under terms and conditions that are not materially different from those arranged with independent parties.

5 million (2008: RM1.409 6.633 322.698 247.409 49. 1967.305 309. TAXATION The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Estimated current tax payable Net transfer from deferred tax assets (Note 45) Prior year tax expense in respect of business vested over from immediate holding company.125 263. The tax charge for the Bank in prior year was related to the net assets vested.517 253. the Bank has unabsorbed tax losses amounting to approximately RM115.4 million) which can be used to offset future taxable profits subject to agreement with the Inland Revenue Board.457 6.457 59.607 197. A reconciliation of income tax expense applicable to profit before taxation at the statutory income tax rate to income tax expense at the effective income tax rate of the Group and of the Bank is as follows: 90 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .279 793 329.150 309. 8515–D 44.830 253.394 The tax charge for the Bank for the current year is in respect of its Labuan offshore branch and tax on shortfall of tax credit under Section 108 of the Income Tax Act.Company No. AMFB Holdings Berhad Under provision in respect of prior years Taxation 6.307 303.279 810 254.892 247. As at 31 March 2009.223.758 5.

reversed upon conversion of instrument as share capital Transfer to income statement Others Balance at end of year 645.409 (2.067 34.290 252.) The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Profit before taxation Taxation at Malaysian statutory tax rate of 25% (2008: 26%) Effect of different tax rates in Labuan Deferred tax relating to changes in tax rates Income not subject to tax Expenses not deductible for tax purposes Intercompany income subject to tax Prior year tax expense in respect of business vested over from immediate holding company AMFB Holdings Under provision of tax expense in prior years Transfer from Equity Deferred tax assets over/ (under) recognised in prior years 1.394 45.873 37.259) (2.915 (2.696 253.501 The Bank 2009 2008 RM’000 RM’000 483.319 6.799 1.741 33.999 (4.198) 241.881 - 189.633) 1.698) 1.319) (32.710 (1.319 6.830 24. TAXATION (CONTD.873 91 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .005) 3.336 645.067 (1.712 (1.495 873.457 427 329.325 309.182) (301.279 793 - 1.962 8.639 (197.767 25.659 980.033 254.514 - 203.863 33.182) (246.501 (1.629) 37. DEFERRED TAX ASSETS The Group 2009 2008 RM’000 RM’000 Balance at beginning of year Recognised in Equity Recognised in Equity previously: .915 (3.230 (263.279 810 - 24.465 646.138 - 1.transfer to income statement . 8515–D 44.319) (32.629) 254.831) 344.826) 46.511) 62.011.767 759.Company No.329 483.194 784.643) 11.

443 428.495 37.404) 34.465 33.501 (33.862 (31.873 305.501 11.052) (31.696 344.905 24.412) 33.309 241.924) 24. DEFERRED TAX ASSETS (CONTD.802 (47.495 51.495 33.067 182.501 92 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .028 645.501 The Bank 2009 2008 RM’000 RM’000 33.501 (33.289) (24.501) 33.501 19.487 22.970 - 30.495 34.501 30.175 (38.742 483.944 The Bank 2009 2008 RM’000 RM’000 28.465 38.) The deferred tax assets/(liabilities) recognised are in respect of the following temporary differences: The Group 2009 2008 RM’000 RM’000 Unabsorbed tax losses Temporary difference between depreciation and tax allowances on property and equipment Temporary difference arising from impairment loss on foreclosed properties General allowance for bad and doubtful debts and financing Temporary difference arising from deferred charges Temporary difference taken up in Equity Others 88. 8515–D 45.568) 37.501) 33.102) (23.699) 33.487 22.230 209.153 (44.486 (36.873 Deferred Tax Assets recognised directly in Equity: The Group 2009 2008 RM’000 RM’000 Balance at beginning of year Relating to Irredeemable Convertible Unsecured Loan Stocks Relating to net unrealised loss on Securities available for sale Relating to Mark to Market loss taken up under Cash Flow hedge reserve Balance at end of year 33.905 223.Company No.000 - 6.639 170.501 4.

The Group 2009 2008 RM’000 RM’000 The Bank 2009 2008 RM’000 RM’000 Net profit attributable to shareholder of the Bank Effect of savings on interest on ICULS (net of tax) 701. EARNINGS PER SHARE (a) Basic Basic earnings per share is calculated by dividing the net profit for the financial year attributable to shareholder of the Group and of the Bank by the weighted average number of ordinary shares in issue during the financial year.56 80. 8515–D 46.Company No.295 610.71 93 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .89 75.364 662.364 52.71 98.183 650.352 505.364 60.930 534.659 104.531 ’000 4.785 529.000 610.364 52.930 655.659 670.929 ’000 4.826 ’000 Number of ordinary shares at beginning of year Effect of the conversion of ICULS Weighted average number of ordinary shares in issue Basic earnings per share (sen) 610.000 610.295 670.282 ’000 746 506.364 662.364 60.896 746 701.

282 6.000 662.659 130.000 710.364 150.000 662.032 ’000 506.364 793.826 6. The Bank has one category of dilutive potential ordinary shares: i) Irredeemable Non-Cumulative Convertible Preference shares ("INCPS") The Group 2009 2008 RM’000 RM’000 Net profit attributable to shareholder of the Bank (as in (a) above) Effect of savings on dividend on INCPS The Bank 2009 2008 RM’000 RM’000 701.44 62.000 515.397 820.26 94 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .659 130.576 ’000 Weighted average number of ordinary shares in issue (as in (a) above) Adjusted for the effect of the INCPS Adjusted weighted average number of ordinary shares in issue Fully diluted earnings per share (sen) 670.750 541.929 ’000 655.364 793.364 150.738 670.929 9.66 83.750 662.531 ’000 534.738 820.Company No. 8515–D (b) Fully Diluted Fully diluted earnings per share is calculated by dividing the adjusted net profit attributable to equity holder of the Bank by the adjusted weighted average number of ordinary shares in issue and issuable during the financial year.397 86.531 9.84 68.

472.75 610.914.417 61.000.801 41 71.473.254.211 66.772.417 Net assets Issued and fully paid up ordinary shares of RM1.870.472.537.253 77.37 670.899 66.67 610.Company No.312 5.419 71.341.914.364 8.19 95 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .225 28 79.870.471.577 3. NET ASSETS PER SHARE (RM) Net assets per share represent the balance sheet total assets value less total liabilities and minority interests expressed as an amount per ordinary share.364 6.727 5.716.043 61. Net assets per share is calculated as follows: The Group 2009 2008 RM’000 RM’000 Total assets Less: Total Liabilities Minority interests 84.857.980 79.364 5.842 The Bank 2009 2008 RM’000 RM’000 70.537. 8515–D 47.626 670.899 66.00 each ('000) Net assets per share (RM) 4.364 9.

541) 65 1.010) 3.706 99 24.594 777.728 913.305. PROFIT BEFORE TAX EXPENSE AND ASSETS By Business Segments The Group 31 March 2009 Revenue External revenue Interest income Fee income Investment and other operating income Income from Islamic Banking: Financing income Fee income Investment and Fees on financing Others (Subsidiaries) Rental Conventional Banking RM'000 Islamic Banking RM'000 Others RM'000 Elimination RM'000 Consolidated RM'000 3.999 5.165 223.337 214. 8515–D 48.659 (1.735 (47.161 715.668 5.523 965.647) (55.132.601.201 2.012 595.000) 828 96 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .032) (55.198 38.070 965.011.201 3.879 45.908 71.803 14.633) 157.895 52.268 5.000) 828 - - - (17.523 745 4.268 (395) 13.752) (1.170 84.429) 523. SEGMENT INFORMATION ON OPERATING REVENUE.934 1.736 75.Company No.929 (47.176 115.783 75.895) (54.866.900.450) 176 125 149 119.895 65 5.724.172) 3.341.487 4.551 1.on subsidiary companies Amortisation of premium less accretion of discount Impairment writeback on amount recoverable under asset-backed securitisation transaction Property and equipment written off 73.873 1.022 38.156) - 73.980 Profit after zakat and taxation Total Assets Other information Capital additions Depreciation Amortisation of prepaid land lease payments Amortisation of intangible assets Loan and financing loss and allowance Impairment loss/(writeback) .142 79 24.457) 701.999 (2.156 (13.052 50.390 14.Rental Total revenue Results Profit before share in results of associated company and taxation Share of net profit in associated company Profit before zakat and taxation Zakat Taxation 2.823 214.176 (17.446 53.929 777.724.498 (363) (363) (52.487 Internal revenue Interest income Others (Subsidiaries) .070 194 113 745 1.337 (253.055 14.902.668 5.879 45.866.867) 403 20 - 36 (115.165 223.317) (17.011.953 (3.055 (1.032) (309.504.on securities .422) 913.

232) (1.Rental Conventional Banking RM'000 Islamic Banking RM'000 Others RM'000 Elimination RM'000 Consolidated RM'000 3.000 1.822 182.419 57.842 8.199 894.661 188.182 1.128) (48.804.025 661 5.985 88 9.173 106.078 49.909 4.388 826.199 270 354 661 1.330 - - - 10.775 22.179.399 45.586 (7.805) 980.179.119) (428) (7.738 67.000 1.248 5.547) 702.160 37.586 (7.075.661 (601) (74.003) 3.896) (48.248 Internal revenue Interest income Others (Subsidiaries) .908 191.896 48. SEGMENT INFORMATION ON OPERATING REVENUE.639 50 50 4.506.119) (7.018.988) 113. PROFIT BEFORE TAX EXPENSE AND ASSETS (CONTD.830) 650.) By Business Segments The Group 31 March 2008 Revenue External revenue Interest income Fee income Investment and other operating income Income from Islamic Banking: Financing income Fee income Investment and Fees on financing Others (Subsidiaries) .039.682 833. 8515–D 48.399 45.330 97 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .Rental Total revenue Results Profit/(loss) before share in results of associated company and taxation Share of net profit in associated company Profit before zakat and taxation Zakat Taxation Profit after zakat and taxation Total Assets Other information Capital additions Depreciation Amortisation of prepaid land lease payments Amortisation of intangible assets Loan and financing loss and allowance Impairment loss on securities Amortisation of premium less accretion of discount Impairment on amount recoverable under asset-backed securitisation transaction Property and equipment written off 790.953 106.414) 535.073 9.246 85 20.092 183.285 46.363 125 125 (46.025 894.Company No.072 11.254.068) 275 107 92 154.908 192.767 (601) (329.647 (7.885 37.075.735 188.775 22.679 88 980.073 (1.152 790.590 679.804.152 (254.336 77.689 826.764) 10.806 105 20.780 (696) 417 20 - 36 - 58.

In the normal course of business. LEASE COMMITMENTS The Group and the Bank have lease commitments in respect of rented premises and equipment on hire.) The directors are of the opinion that all inter-segment transactions have been entered into in the normal course of business and have been established under terms and conditions that are no less favourable than those arranged with independent parties.081 14. 8515–D 48. all of which are classified as operating leases.153 2.797 122.158 2. A summary of the non-cancellable long-term commitments.788 87. net of subleases is as follows: The Group 2009 2008 RM’000 RM’000 Year ending 31 March: 2009 2010 2011 2012 2013 and thereafter 28.457 30.801 35.721 15.572 21.110 19.240 124.946 192.736 15.Company No.379 243.713 122.140 32.298 9. 98 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .523 21.560 29.721 5.894 The Bank 2009 2008 RM’000 RM’000 The lease commitments represent minimum rentals not adjusted for operating expenses which the Group and the Bank is obligated to pay.842 238.406 Authorised but not contracted for: Purchase of computer equipment and software 54.558 20. These amounts are insignificant in relation to the minimum lease obligations.140 32.183 14.685 5. PROFIT BEFORE TAX EXPENSE AND ASSETS (CONTD.154 22.514 124.870 40.973 19. The financial information by geographical segment is not presented as the Group's activities are principally conducted in Malaysia.747 197.293 9.705 30.247 23.501 27. thus it is anticipated that future annual minimum lease commitments will not be less than rental expenses for the financial year.885 87.672 20. the Group and the Bank have the following commitments: The Group 2009 2008 RM’000 RM’000 Authorised and contracted for: Purchase of computer equipment and software Leasehold improvements The Bank 2009 2008 RM’000 RM’000 30.966 50. 49 CAPITAL COMMITMENTS As at the balance sheet date.657 34.162 54. leases that expire will be renewed or replaced by leases on other properties.180 41. SEGMENT INFORMATION ON OPERATING REVENUE.

The detailed disclosures on the risk-weighted assets. as set out in Notes 51 (d) to (f) are presented in accordance with paragraph 4.09% 2009 10. the Bank acquired the assets and assumed the liabilities relating to AmInvestment Bank Berhad fund based activity including its 100% shareholding interest in AMIL. which is based on the Basel I capital accord. Note 2 The capital adequacy ratios of AMIL for capital compliance on a standalone basis are computed in accordance with the guidelines on Risk-weighted Capital Adequacy issued by Labuan Offshore Financial Services Authority (LOFSA).12% 12.Company No. whereby such disclosures are effective for financial periods beginning on or after 1 January 2008.62% 2008 7.65% Note 2 AMIL 33. The capital adequacy ratios of the Bank refers to the combined capital base as a ratio of the combined riskweighted assets of the Bank and its wholly-owned offshore banking subsidary company. The Group and the Bank have adopted the Standardised Approach for Credit Risk and Market Risk and the Basic Indicator Approach for Operational Risk.22% Core capital ratio Risk-weighted capital ratio Note 1 The capital adequacy ratios of AmIslamic Bank Berhad (AmIslamic) are computed in accordance with Bank Negara Malaysia's Capital Adequacy Framework for Islamic Banks (CAFIB). Pursuant to the Business Transfer Agreement entered in March 2008 and the vesting orders granted by the High Court of Malaya on 9 April 2008. The comparative capital adequacy ratios for 31 March 2008 have not been restated as they represent actual amounts reported for regulatory compliance purposes as of that date.96% The capital adequacy ratios on a consolidated basis of the banking institutions within the Group and the Bank are computed in accordance with Bank Negara Malaysia's revised Risk-weighted Capital Adequacy Framework (RWCAF . a licensed offshore bank.Basel II). (b) The capital adequacy ratios of the banking subsidiary companies of the Group are as follows: Note 1 AmIslamic 11.39% 14. AmInternational (L) Ltd ("AMIL"). 99 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .08% 13.09% 33. which are based on the Basel II capital accord.20% The Bank 2008 8. The minimum regulatory capital adequacy requirement is 8% for the risk-weighted capital ratio. AmIslamic has adopted the Standardised Approach for Credit Risk and Market Risk and the Basic Indicator Approach for Operational Risk. CAPITAL ADEQUACY RATIO (a) The capital adequacy ratios of the Group and the Bank as at 31 March are as follows: The Group 2009 Core capital ratio Risk-weighted capital ratio 9.3 of Bank Negara Malaysia's Concept Paper Risk-weighted Capital Adequacy Framework (Basel II) and Capital Adequacy Framework of Islamic Banks (CAFIB) Disclosure Requirements (Pillar 3).22% 16. 8515–D 51.25% 14.

665.306 (11) 6.055 (377.405 6.655 3.298.100 500.752.000 548.508 The Bank 2009 2008 RM’000 RM’000 Less: Deferred tax assets Total Tier 1 capital Tier 2 capital Irredeemable Convertible Unsecured Loan Stocks Innovative Tier 1 capital Subordinated term loans Medium term notes Subordinated bonds Exchangeable bonds General allowance for bad and doubtful debts and financing Total Tier 2 capital Less: Excess Tier 2 Capital Maximum allowable Tier 2 Capital 5.330.364 150.000 895.364 150.000 200.660 770.459 21.000 575.096.297 (816.028 (596.971.953.364 150. 8515–D 51.399 610.202.903 460.766.435 Less: Investment in subsidiary companies Other deduction Capital base (32.188 (435.189 610.028) 3.060 41 670.901 5.214.660 680. CAPITAL ADEQUACY RATIO (CONTD.295 2.000 942.252.330.844 680.586 234.764.228 3.566 11.000 575.148 8.460.780) (10.219) 7.222 3.148 291.904 1.864.844 849.334) 5.050) 3.000 942.000 575.869.149 3.850) (10.223 100 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .364 150.455 (667.752.050 735.232 1.000 600.481.566 3.041.655 8.460.492 397.160 1.898 377.242.920) 2.Company No.100 500.655.000 575.484.000 400.586 201.459 1.135 6.901 (306.492 349.996.000 620.463 710.323 (204.367 1.000 750.000 860.763.295 (813.322.000 515.219) 8.197 710.148 2.849) (11) 5.434.567 4.174) 5.637 460.000 750.655 291.000 860.000 729.127) 3.764.000 775.277.) (c) The components of Tier I and Tier II Capital of the Group and the Bank are as follows: The Group 2009 2008 RM’000 RM’000 Tier 1 capital Paid-up share capital Irredeemable Non-Cumulative Convertible Preference Shares Innovative Tier 1 capital Non-innovative Tier 1 capital Share premium Statutory reserve Capital reserve Merger reserve Exchange fluctuation reserve Retained profits Minority interests 670.232 377.

796.789 2.176 1.810 12.232 1.226.986 61.602.568.680 14.922 The Bank 2009 2008 RM’000 RM’000 45.146 101 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .356 12.631.717 3.157. 8515–D 51.986 50.384.783.474 51.572.372 1.) The breakdown of the risk-weighted assets in various categories of risk are as follows: The Group 2009 2008 RM’000 RM’000 Credit risk Market risk Operational risk Large exposure risk requirement for equity holdings Total risk-weighted assets 54.203 1.922 14.474 42.350 3.Company No.530 46.302. CAPITAL ADEQUACY RATIO (CONTD.431 38.892.346.833.560.654.502 4.487.

General interest rate risk .988 23.399 359.396 4.293 592.179.) (d) The breakdown of risk-weighted assets ("RWA") by exposure in each major risk category of the Group for the current financial year is as follow: Gross Exposures Net Exposures Risk Weighted Assets Capital Requirements RM'000 Credit Risk On-Balance Sheet Exposures Sovereigns/Central Banks Public Sector Entities Banks.955 4.349 288.458.658 Short Position 12.717.063.986 1.317.431 193.916 334.437 2.080 165.927.293 20.379.810 61.809.464 10.Balance Sheet Exposures Off-Balance Sheet Exposures Over The Counter ("OTC")Derivatives Credit Derivatives Off balance sheet exposures other than OTC derivatives or credit derivatives Total for Off.386.564 6.475 217.025 4.618 247.502 4.516 88.052 1.972 90.946 4.636.375 4.186 1.692 718.470.144.475 215.Balance Sheet Exposures Large Exposures Risk Requirement Market Risk Long Position 1.833.644 28.919.386.393 32.636 1.422 16.623 1.762 70.135 2. 8515–D 51 CAPITAL ADEQUACY RATIOS (CONTD.712 49.921.086 6.196.475 215.928 RM'000 RM'000 RM'000 16.196.052 1. Development Financial Institutions ("DFI") and Multilateral Development Banks ("MDBs") Insurance Companies.665 1.718.396 1.392 3.684 3.025.424 2.099 351.928 - 14.Balance Sheet Exposures Total On and Off.717 32.293 20.235 1.475 73.623 6.Company No.578 1.076 352.304.393.000 33.350 392.293 79.549.307.836 54.712 6.032.121 102 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .320 151.135.008.000 1.455 1.993.864 3.898.530 110.079.149.212.504 1.806 96.490 19.183.842.630 6.911.424 288.208 - 4.809.079.169.422 578.284 20.329.133 21.892.464 10.General rate risk .228 46.078 5.609 83.938 20.233 4.487.242.864 3.803 16.762 70.665.902 40.451 23.544 57.220 165. Securities Firms and Fund Managers Corporates Regulatory Retail Residential Mortgages Higher Risk Assets Other Assets Equity Exposures Securitisation Exposures Defaulted Exposures Total for On.993.304.039 Interest Rate Risk .Specific interest rate risk Foreign Currency Risk Equity Risk .133 19.966 28.232 346.392.098 82.Specific risk Option Risk Operational Risk Total RWA and Capital Requirements 30.159 6.258 338 5.424 288.226.206 28.

254.330 288.052 1.238.149 6.271 1.475 73.418 68.298 2.731 14.576 1.727 654.224 578.916 316.654.990.109.377.900 6.315 1.431 97.Company No.208 165.132 1.614.Specific risk Option Risk Operational Risk Total RWA and Capital Requirements 29.544 212.335.348 73.259 322 3.864 1.253 288.330 288.568.293 20.078 5.293 193.578 1.549 3.594 1.304.886.864 2.527.Balance Sheet Exposures Total On and Off.882.243.493 28. Securities Firms and Fund Managers Corporates Regulatory Retail Residential Mortgages Higher Risk Assets Other Assets Equity Exposures Securitisation Exposures Defaulted Exposures Total for On.955.925 24.165 45.Balance Sheet Exposures Off-Balance Sheet Exposures OTC Derivatives Credit Derivatives Off balance sheet exposures other than OTC derivatives or credit derivatives Defaulted Exposures Total for Off.219.644 28. 103 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .389 19.Specific interest rate risk Foreign Currency Risk Equity Risk .304.588 45.700 52.028 46.584 310.412.444 6.675.244.990 20.667 24.293 24.367 - 9.796.372 12.997 5.184.304 41.654.464 10.073 726 1.958.231.367 RM'000 RM'000 RM'000 13.859 247.475 215.644 20.125 1.063.378 1.645.954 3.717 3.660 4.224 13.057 263.805.877.812.464 10.052 1.459.475 215.) (d) The breakdown of risk-weighted assets ("RWA") by exposure in each major risk category of the Bank for the current financial year is as follows: Gross Exposures Net Exposures Risk Weighted Assets Capital Requirements RM'000 Credit Risk On-Balance Sheet Exposures Sovereigns/Central Banks Public Sector Entities Banks.623 1.233 4.828 4.109.894 191.930 132.770.150.713 The Group and the Bank does not have any issuance of Profit-Sharing Investment Account ("PSIA") used as a risk absorbent. Development Financial Institutions ("DFI") and Multilateral Development Banks ("MDBs") Insurance Companies.469 1.356 50.378.314 18.000 31.588 45.986 3.691.197.General rate risk .General interest rate risk .805.064 28.560.252.357.099 351.301 165.796 3.394 18.293 20.377 284. 8515–D 51 CAPITAL ADEQUACY RATIOS (CONTD.623 1.706 18.611.685 74.Balance Sheet Exposures Large Exposures Risk Requirement Market Risk Long Position 1.294.705.656 351.748 69.806 94.489.740 23.075 - 3.866.456 3.770.892 1.314 17.864 2.039 Short Position Interest Rate Risk .

700 990.866 1.666 118.897 3.569.163.876 32. Banks.114 18.493 5.350.198.159 20.493 3.959 3.368 20.033 35.Company No.435 25.878.433.959 - 1.809.586 33.625.486 24. 8515–D 51.900 - 288.484.360.513.751.225 1.291 16.039 - 4.232 40 40 104 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .092 3.833.302 - 170.913 1.897 2.746 170.475 - 16.835 258.528 1.415. CAPITAL ADEQUACY RATIOS (CONTD.222 2.170 6.208 54.415.163.107.770.322. MDBs Securities and DFIs Firms and Fund Managers RM'000 RM'000 Total Exposures after Netting and Total Risk Equity Weighted Assets Credit Risk Exposures Mitigation Risk Weights Sovereigns and Central Banks Public Sector Entities Corporates Regulatory Retail Residental Mortgages Higher Risk Other Assets Assets Securitisation Exposures RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 0% 20% 35% 50% 75% 100% 150% Average Risk Weight Total Deduction from Capital Base 16.491.975 880.088 14.424 215.994 10.645 6.228.864 288.475 88.378 157.172.756.054 1.923 70.486 - 3.787 4.869 33.040 3.077.923 - 70.771.458 493 218.247 367.198.) (e) The breakdown of credit risk exposures by risk weights of the Group for the current financial year is as follows: Exposures after Netting and Credit Risk Mitigation Insurance Companies.140.866 292.495 (22.911.910.019 1.392.243.372) 168.

544 363.072.749 - 45.751) 13.864 288.770.362.061.088 14.243.653 18.358 2.378 141.451 3.749 45. 8515–D 51.330 168.367 - 1.260.607 - 166.945.177.796. Banks.357 21.061.455.831 16.319.214 10.889 1.122 1.948 1.568.598.876 32.133.685 25.111. MDBs Securities and DFIs Firms and Fund Managers RM'000 RM'000 Total Exposures after Netting & Total Risk Weighted Assets Credit Risk Mitigation Risk Weights Sovereigns and Central Banks Public Sector Entities Corporates Regulatory Retail Residental Mortgages Higher Risk Other Assets Assets Securitisation Exposures Equity Exposures RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 0% 20% 35% 50% 75% 100% 150% Average Risk Weight Total Deduction from Capital Base 13. CAPITAL ADEQUACY RATIOS (CONTD.797 26.475 13.871 18.036.378 102.190 2.591.571 18.) (e) The breakdown of credit risk exposures by risk weights of the Bank for the current financial year is as follows: Exposures after Netting and Credit Risk Mitigation Insurance Companies.808 258.942 493 204.889 287.111.211 73.784 1.399.014 936.969 4.091.493 166.461.075 1.475 - 288.357 - 3.859 3.372 40 40 105 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .738 1.075.451 5.816 45.086.260.785 6.072.917 3.900 215.589 (14.293 5.399.190 3.142 25.458.300.039 - 4.509.795.367 3.485 785.Company No.

022 765.681.284 879.512 748.170 137.Over one year to five years Interest rate related contracts Interest rate futures .088 561.300 11.657 879.301.329.298 1.965 98.928.) (f) The Off-Balance Sheet exposures and their related counterparty credit risk of the Group are as follows: Group Principal Amount 2009 RM'000 Positive Fair Value of Derivative Contracts RM'000 Credit Equivalent Amount RM'000 Risk Weighted Assets RM'000 Credit-Related Exposures Guarantees given on behalf of customers Certain transaction-related contingent items Short term self liquidating trade-related contingencies Islamic financing sold to Cagamas Berhad Irrevocable commitments to extend credit maturing : .461 477.034 13.887.114.899 298.815 740.260.433 98.552 607 - 30.528 450.215.360 60.346 206 150 4.754 2.Over one year to five years 824.903 184.496.383.911. 8515–D 51.210 6.931 311.000 4.Company No.022 4.904 291.260.Over five years Equity related contracts: Options .386 655.132 1.707 390 3.697 21.866 493.154 26.755.496 30.068 26.581 Derivative Financial Instruments Foreign exchange related contracts: Forward exchange contracts .173 10.721 14.088 280.282 29.952 9.One year or less .One year or less Cross currency swaps .435 5.One year or less .853 2.132 10.One year or less .458.Over one year to five years Interest rate swaps .005 351.105 4.233 Other Treasury-related Exposures Forward purchase commitments Total 265.144.000 48.836 106 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .972 4.641.512 1.000 164.464 578.716 663.304.694 212 150 5.more than one year Unutilised credit card lines Sell and buy back agreements Others 2.588 1.Over one year to five years .507 12. CAPITAL ADEQUACY RATIOS (CONTD.997 241.305 477.127 22.000 17.472 153.552 876.

952 9.One year or less .918 390 1.360 60.877.274 87.321 18.685 578.569 217.000 44.000 119.173 10.588 1.552 607 - 30.507 12.Over one year to five years Interest rate swaps .034 13.One year or less .496 30.239 3.314.more than one year Unutilised credit card lines Others 2.931 311.420 475.896.705 2.528 450.107.233 4.796 Derivative Financial Instruments Foreign exchange related contracts: Forward exchange contracts .) (f) The Off-Balance Sheet exposures and their related counterparty credit risk of the Bank are as follows: Bank Positive Fair Value of Derivative Contracts RM'000 Credit Equivalent Amount RM'000 Risk Weighted Assets RM'000 Principal Amount 2009 RM'000 Credit-Related Exposures Guarantees given on behalf of customers Certain transaction-related contingent items Short term self liquidating trade-related contingencies Irrevocable commitments to extend credit maturing : .Company No.853 2.306 87.Over one year to five years .755.899 298.170 137.215.197.697 21. CAPITAL ADEQUACY RATIOS (CONTD.Over one year to five years Other Treasury-related Exposures Forward purchase commitments Total 824.510 270. 8515–D 51.282 29.660 26.882.464 10.725 649.Over five years Equity related contracts: Options . 107 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .One year or less .224 5.Over one year to five years Interest rate related contracts Interest rate futures .257.057 As at 31 March 2009.760.000 4.877.092.028 3.721 14.005 351.000 17.743 150 3.548 437.435 5.627 10.419 1.One year or less Cross currency swaps .119 775.022 765. the Bank has given a continuing guarantee to Bank Negara Malaysia to meet all the liabilities and financial obligations of its subsidiary company.997 1.641.903 184.068 26.525 150 3. AmInternational (L) Ltd.419 657.213 270.092.303 579.294.551 540.247 475.247 1.369.904 291.304.

889 30.411 801.081 5.422.855 113.826.216.853 2.943 2.119.716 296.600.928.976 1.Company No.034 13.104 212 874.639.903 184.404.154 153.108 34.123 479.932 2.432 2.390.419 945.216.524 10.867 23.028.483.588 60.433 98.602.005 351.000 155.952 25.067 194.012 598.822 4.243 1.775. the Group and the Bank make various commitments and incur certain contingent liabilities with legal recourse to its customers.057.299 163.472 206.403 8.067 6.138.552 206 663.552 876.886 1.082 297.045 4.383.819 14.857 13.070 118.641.000 1.776 571.782 1.904.771 1.155 1. The risk-weighted exposure of the Group and the Bank is as follows: The Group As at 31 March 2009 Credit Risk Principal Equivalent Weighted Amount Amount* Amount RM'000 RM'000 RM'000 2.022 14.762.488 120.256 31.857 11.981 2.571 462.220.282 4.624 57.554 1.000 250 241.279.725 12.515 21.512 748.496 12.866 493.000 250 10.275 93.260.863.396 595.580 116. No material losses are anticipated as a result of these transactions.386 655.449 338.628 62.953.216.023 296.215.173 10.965 98.081 102.063.657 296.263.068 26.500 250 1.560 874.863.435 5.782 1.210 30.558.755.496.628 15.815 740.659 81.144 824.891 49.300 250 1.015 29.000 150.000 1.846 1.473 Direct credit substitutes Certain transaction-related contingent items Short-term self-liquidating trade-related contingencies Obligations under underwriting agreements Unpaid portion of partly paid shares Irrevocable commitments to extend credit: – maturing less than one year – maturing more than one year Unutilised credit card lines Forward purchase commitments – less than one year Foreign exchange related contracts: – less than one year Cross currency swap – less than one year – maturing more than one year to less than five years Interest rate swap contracts: – maturing within one year – maturing more than one year to less than five years – maturing more than five years Interest rate futures: – maturing within one year – maturing more than one year to less than five years Sell and buy back agreements Islamic financing sold to Cagamas Berhad with recourse Equity options Any commitments that are unconditionally cancelled at any time by the Group Total 108 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .528 450.284 592.211. The commitments and contingencies are not secured against the Group’s and the Bank’s assets.899 298. COMMITMENTS AND CONTINGENCIES In the normal course of business.512 1.488 As at 31 March 2008 Credit Risk Principal Equivalent Weighted Amount Amount* Amount RM'000 RM'000 RM'000 1.346 4.931 311.290 338.191 145.526.655 13.022 765.930 1.000 250 8.160 584.360 9.503 4.694 10.000 250 280.997 5. 8515–D 52.000 17.260.145 1.721 21.006.

372.Company No.725 As at 31 March 2008 Credit Risk Principal Equivalent Weighted Amount Amount* Amount RM'000 RM'000 RM'000 1.000 17.986.659 81.000 1.097.187.319.877.314.569 96.215.644.015 29.306 87.289 649.068 26.191 145.760. COMMITMENTS AND CONTINGENCIES (CONTD.999 338.563 * The credit equivalent amount is arrived at using the credit conversion factors as specified by Bank Negara Malaysia.119 775.195.274 87.070 118.299 163.109 519.655 13.721 21.034 13.953.419 2.496 12.854 1.241 3.933 98.000 149. 8515–D 52.000 150.867 18.120 1.995 338.548 437.) The Bank As at 31 March 2009 Credit Risk Principal Equivalent Weighted Amount Amount* Amount RM'000 RM'000 RM'000 2.202.123 479.092.104 5.419 1.819 14.315 511.371 860.641.224 30.524 10.931 311.000 150 8.503 4.062 657.000 150 7.282 4.755.108 34.081 102.627 211.275 93.630.552 3. 109 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .891 1.932 2.434 259.435 5.588 60.500 150 270.436 1.658 102.808 3.922 776.899 298.287 1.303 579.001.853 2.628 15.310.973 1.650 51.000 150 1.500 150 217.776 5.145 824.515 21.022 765.314 45.855 1.762.455.523 30.216.488 120.528 450.434 516.571 462.554 7.081 5.881.600.320.051.454.000 13.551 193.800 150 Direct credit substitutes Certain transaction-related contingent items Short-term self-liquidating trade-related contingencies Obligations under underwriting agreements Unpaid portion of partly paid shares Irrevocable commitments to extend credit: – maturing less than one year – maturing more than one year Unutilised credit card lines Forward purchase commitments : – less than one year Foreign exchange related contracts: – less than one year Cross currency swap – less than one year – maturing more than one year to less than five years Interest rate swap contracts: – maturing within one year – maturing more than one year to less than five years – maturing more than five years Interest rate futures: – maturing within one year – maturing more than one year to less than five years Equity options Any commitments that are unconditionally cancelled at any time by the Bank Total 1.952 25.281 2.660 121.405.289 258.720.028 14.005 351.031.360 9.510 96.092.628 62.525 10.904 690.173 10.725 12.903 184.743 4.256 31.

BNM and Securities Commission had. The NCPCS and SubNotes cannot be traded separately until the occurrence of certain Assignment Events. and Subordinated Notes ("SubNotes") issued by AmPremier Capital Berhad ("AmPremier"). SIGNIFICANT EVENTS (1) The Group and AmInvestment Bank Berhad ("AmInvestment") had on 11 March 2008 entered into a Business Transfer agreement for the transfer of assets and liabilities relating to the investment. The proceeds raised was utilised for the refinancing of existing subordinated debts and general working capital requirements. The gross proceeds raised from the RM NIT1 Programme will be applied towards funding the growth of the Bank’s business operations. to the Bank.000 and an issued and paid-up share capital of RM1. to undertake the business of securitization of mortgage loans. The RM NIT1 comprises the Non Cumulative Perpetual Capital Securities ("NCPCS") issued by the Bank. 8515–D 53. The RM NIT1 issuance is structured in accordance with the Risk-Weighted Capital Adequacy Framework (General Requirements and Capital Components) issued by Bank Negara Malaysia (“BNM”). treasury and credit/lending activities or businesses ("the Fund-Based Activities") of AmInvestment to the Group. the Bank issued the Sixth Tranche of Medium Term Notes ("MTN") amounting to RM600 million.46 billion MTN under the RM2. The total purchase consideration for all the net assets transferred amounted to RM1. (2) On 9 April 2008.432 billion for the Bank and the Group respectively. 110 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . The Stapled Capital Securities are rated A3 by RAM Rating Services Berhad. AmBank had established a wholly-owned subsidiary under the name of AmMortgage One Berhad ("AmMortgage"). The assets tranferred included AmInvestment's 100% shareholding in AmInternational (L) Ltd. approved the RM NIT1 Programme. a licensed offshore bank. as part of its capital management initiatives to support and strengthen its capital position whereby the first tranche of RM200 million was issued on 27 February 2009 whilst the remaining RM300 million was issued on 6 March 2009. The transfer of the Fund-Based Activities was effected on 12 April 2008 26 September 2008 and 1 March 2009. (4) Upon BNM's approval dated 19 February 2009. 1989 by way of vesting orders obtained from High Courts.Company No. Todate. a newly incorporated wholly-owned subsidiary company of the Bank which are stapled together with the NCPCS.0 billion nominal value MTN Programme.117 billion and RM1. The stapled NCPCS and the SubNotes together constitute the “Stapled Capital Securities”.000. (3) The Bank has successfully completed the RM500 million RM NIT1 Programme. The transfer of the Fund-Based Activities was in relation to a group restructuring exercise approved by the Minister of Finance as announced by AMMB Holdings Berhad ("AHB"). the Bank has issued a total of RM1. on 11 March 2008 to Bursa Malaysia Securities Berhad. The transfer of the Fund-Based Activities was effected pursuant to Section 50 of the Banking and Financial Institutions Act. AmMortgage has an authorised share capital of RM100. via their letters dated 23 December 2008 and 6 January 2009 respectively. the Group's ultimate holding company.

The market risk of the Group's trading and non-trading portfolio is managed separately using value at risk approach to compute the market risk exposure of non-trading portfolio and trading portfolio. further diversify and have a differentiated growth strategy within its various business lines. Every risk assumed by the Group carries with it potential for gains as well as potential to erode shareholders' value. The management approach towards the significant risks of the Group are enumerated below: MARKET RISK MANAGEMENT Market risk is the risk of loss from changes in the value of portfolios and financial instruments caused by movements in market variables. the Group also institutes a set of scenario analysis under various potential market conditions such as shifts in currency rates. To complement value at risk measurement. The Group's risk management policy is to identify. The Group's current strategic goals are for top quartile shareholder returns and target return on equity wherein the Group will de-risks. capture and analyse these risks at an early stage. The Group controls the market risk exposure of its trading and non-trading activities primarily through a series of risk threshold. 8515–D 54. foreign exchange rates and equity prices. RISK MANAGEMENT POLICY Risk management is about managing uncertainties such that deviations from the Group's intended objectives are kept within acceptable levels. continuously measure and monitor these risks and to set limits. general equity prices and interest rate movements to assess the changes in portfolio value. brought about by daily changes in market rates over a specified holding period at a specified confidence level under normal market condition. The risk thresholds structure aligns specific risk-taking activities with the overall risk appetite of the Group. such as interest rates. The primary objective of market risk management is to ensure that losses from market risk can be promptly arrested and risk positions are sufficiently liquid so as to enable the Group to reduce its position without incurring potential loss that is beyond the sustainability of the Group. Sustainable profitability forms the core objectives of the Group's risk management strategy. Value at risk is a statistical measure that estimates the potential changes in portfolio value that may occur.Company No. 111 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . Risk thresholds are approved by the Board of Directors. policies and procedures to control them to ensure sustainable risk-taking and sufficient returns.

886 203.853 1.473 771.374.222 14.483 612.483 2.727 21.372) 70.135 7.925 10. The following tables show the interest rate sensitivity gap.288 7.531 122.120.638 15.704 21.000 73.253 9.446.189 10.516 84.807.460.447 421.000 145.313) 1.719 155.106.343.641.120.Non Trading Book ------------------------------------------------------------------> NonUp to 1 >1 to 3 >3 to 6 >6 to 12 >1 to 5 Over interest month months months months years 5 years sensitive RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 13.706 609.834 787.221.832.844.533 652.382) 6.000 500.374) 1.484 753.359 477.429 609.225) 9.732 11.261 613.341.350 18.650.372) 2.050 1.374) (4.142.387.549 63.817 35.448.307.807 7.341.000 4. 8515–D 54.00 - * This is arrived at after deducting the general allowance.236.153 152.135 477.400.836.383 8.199 2009 The Group ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.460.07 3.914.132 56.076 483.948 775.270. on which interest rates of instruments are next repriced on a contractual basis or.549 Total RM'000 17.225 28 4.925 (9.409.477.516 17.66 4.183.862 673.975 129.617 150.818 28 4.999 (8.297 (755.881. specific allowance and interest / income-in-suspense from gross non-performing loans outstanding.579 2.000 150.669.017.249 155.641.130.549 1.384.646.519 3.367. if earlier.16 4.135.000) (60.288 (6.789 1.088 (4.820 500.980 Effective interest rate % 1.382) (3.183.62 2.343.383 26.980 (60.037 3.662.989 2.74 2.853 8.789 8.086 1.448.838 2.471.000 1.471.590 3.183.757 7.821 6.485 2.946.Performing .142.709 12.002 145.406 565.127 1.93 2.98 2.384.983 565.210 25.870.607.81 5.Non-performing * Amount due from originators Other non-interest sensitive balances TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Term loans Stapled Capital Securities Irredeemable Non-Cumulative Convertible Preference Shares Other non-interest sensitive balances Total Liabilities Minority interests Shareholder's Equity TOTAL LIABILITIES AND EQUITY On-balance sheet interest sensitivity gap Off-balance sheet interest sensitivity gap ** Total interest sensitivity gap Trading Book RM'000 1.412 2.222 4.709 372.369 825.549 1.192.69 5.000 (9.842 781.Company No.727 84.947.989 220.80 9.541 1.748 778. by time bands.833.521.588) 13.820 26.553 51.000 575.569 400.165.413.183.561 11.999 11.598.549.45 5. advances and financing .000 400.000) 2.214.853 1.573 (4.74 - 22.787.086 25.000) (11.367.211.037 825. 112 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . the dates on which the instruments mature.411 5.128.203 7.132 9.832.446.655.242 79.128.811.353) 7.590 5.22 1.000 1.221.583 245.763.98 6.10 3.606 (798.917 34.367 60.002. ** This comprises interest rate swap and interest rate futures.100 1.186.000 140.475 448. <------------------------------------------------------------.050 1.242 17.214.794 549.93 6.000 575.000 150.479.372.692.

317.306.099 1.255 415.689 485.000 1.579 2.Company No.000 24.419 55.042 700.258 Total RM'000 10.28 3.683.455 1.700 3.668 8.263.009 352.604 1.313 498.329.000 575.565 77. if earlier.452 614.736.609.600 271.492.85 5.000 150.748.168 1.726.27 5.651 51.779 (7.867 3.700 4.357.063.269.50 3.497. by time bands.508.38 3.930.764 41 5.79 5.575.574 6.646 22. on which interest rates of instruments are next repriced on a contractual basis or.42 3.435.000 271.938) (36.124.483 897.45 5.713 200.490 8.818 1.07 4.983.094 2.103.726.430 3.130 15.651 8.462.979 460.547.000 689.785 20.061) (1.254.992.700 6.727 14.Non-performing * Amount due from originators Other non-interest sensitive balances TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Subordinated term loans Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Term loans Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-Cumulative Convertible Preference Shares Other non-interest sensitive balances Total Liabilities Minority interests Shareholder's Equity TOTAL LIABILITIES AND EQUITY On-balance sheet interest sensitivity gap Off-balance sheet interest sensitivity gap ** Total interest sensitivity gap Trading Book RM'000 6.242) 531.992.200 3.190 9.258 6.748.852) (4.007 1.448 26.540 521.500 648.482.207.630.419 (36.431 3.82 3. the dates on which the instruments mature.880 43.536 307.181) (9.103.537.480 559. 113 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .795 35.65 6.025.718 7.745 6.779 8.755 7.066) (2.486 307.482. advances and financing .533 7. specific allowance and interest / income-in-suspense from gross non-performing loans outstanding.334 8.026.868.347 400.105 2.866 352.978 2.565 15.241 6.000 575.801 41 5.402 71.670 1.124.258 6.820 12.87 6.Performing .313.500 (2.000 1.634.645. <------------------------------------------------------------.402 14.312.515.313.972 147.361 176.201 567.708.243 243.533 (6.140 3.334 (5.341 18.497.909.344 26.648) (9.795 3.042 460.919 1.800 12.978 24.349.792 3.864.90 7.000 128.618 200.007 547.974.000 2.000 600.025.269.490 131.254. 8515–D 54.177.820.33 - 3.469 860.630.124.395 689.830 676.197 522.113 2.408.604 150.000) 1.155.760) 5.029.258 6.888.311.861 310.726 7.280.59 3.469 860.999 1.771.75 - * This is arrived at after deducting the general allowance.668 1.716.961 357.714) 85.900 63.531. ** This comprises interest rate swap and interest rate futures.124.481 43.771 27.852) 2008 The Group ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.267.577 77.505 11.738 9.399.849 3.156.331.039.344 49.61 5. The following tables show the interest rate sensitivity gap.938) Effective interest rate % 3.741 8.356.793.590 (4.619.467 5.107.805 269.830 70.070 8.660 77.22 5.221.739 1.Non Trading Book ------------------------------------------------------------------> NonUp to 1 >1 to 3 >3 to 6 >6 to 12 >1 to 5 Over interest month months months months years 5 years sensitive RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 8.265.725.

186.638 15.748 767. ** This comprises interest rate swap and interest rate futures.563 710.590 3.750) 2.680 155.000) (60.199.88 6.343. specific allowance and interest / income-in-suspense from gross non-performing loans outstanding.656.797 (755.119 427.857.772.143 25.513 775.635 9.798 475.925 10.400.820 26.93 2.307.269.662.762.213.498.817 35.037.000 1.757 7.000 4.645.16 4.549 5.146 366.110 (4.430 635.698) (4.650 997.175 51.456 2.098 2.732 11.000 (9.000 150.000) (11.304.127 11.456 25.426.795 115.22 1.203 7. AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 114 .914.07 3.80 9.372 220.446.681.510) (3.000 500.853 (6.10 3.618.857.588) 13.000 575.379.384 26.088 (4.362.Company No.374.209 2. 8515–D 54.473 771.186.114 34.499.127 (8.600 150.807 7.739 66.142.506.820 500.086.106.002 145.04 2.747 11.549 1.164.361 781.263.362.367 60.211.372 102.922 549.190.183.789 2.832.106.211.634.00 1.607.186.899 3.77 2.568.183.549 Total RM'000 13.772.247 635.531 122.247 46.142.412 2.845 6.549 1.369 825.704 21.600 1.120.988 (798.100 1.400.264.889 3.853 7.881.787.409.218.222 14.037 3.162. the dates on which the instruments mature.673 483.719 155.698) - 53.162.019 471.189 10.305 563.69 5.183.460.914.533 652.507.750) 70.853 1.222 4.117 70.261 614.312 70.834 787. if earlier. The following tables show the interest rate sensitivity gap.471 73. by time bands.508 2.384 8.739 4.Non-performing * Amount due from originators Other non-interest sensitive balances TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Subordinated term loans Medium term notes Exchangeable bonds Term loans Stapled Capital Securities Irredeemable Non-Cumulative Convertible Preference Shares Other non-interest sensitive balances Total Liabilities Shareholder's Equity TOTAL LIABILITIES AND EQUITY On-balance sheet interest sensitivity gap Off-balance sheet interest sensitivity gap ** Total interest sensitivity gap Trading Book RM'000 1.053.853 8.617 155.551.095.63 2.000 575.98 6.970 6.263.183.000) 2.583 245.969 622 129.789 8.211 (60.000 140.Performing .460.510) 6.353) 7.117 4.325 563.853 1.549 - * This is arrived at after deducting the general allowance.037 825.884) 1.312 8.74 22.798 3.784.838 2.590 5.475 448.143 1. on which interest rates of instruments are next repriced on a contractual basis or.050 1.155. advances and financing .925 (9.Non Trading Book ------------------------------------------------------------------> NonUp to 1 >1 to 3 >3 to 6 >6 to 12 >1 to 5 Over interest month months months months years 5 years sensitive RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 13. <------------------------------------------------------------.183.211 Effective interest rate % 2.095.154 12.000 1.796) 9.446.66 5.425 475.343.850 18.412 2009 The Bank ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.000 145.45 5.

167 (4.469 860.61 5.066 15.124.306.505 11.085) 3.258 48.576.042 699.152.000 200.171 352.630.774 1.895 307.473.333 4.727 14.258 Total RM'000 8.819.490 8. ** This comprises of interest rate swap and interest rate futures.000.45 5.674 26.185.408.426 286.540 508.618.765. the dates on which the instruments mature.345.83 7.938) 3.330.613 1.267.241 6.043 (36.518 5.107.40 3.070 8.115.07 4.472.736 2.75 - * This is arrived at after deducting the general allowance.124.65 6.603 415.Non-performing * Amount due from originators Other non-interest sensitive balances TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Subordinated term loans Medium term notes Subordinated bonds Exchangeable bonds Term loans Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-Cumulative Convertible Preference Shares Other non-interest sensitive balances Total Liabilities Shareholder's Equity TOTAL LIABILITIES AND EQUITY On-balance sheet interest sensitivity gap Off-balance sheet interest sensitivity gap ** Total interest sensitivity gap Trading Book RM'000 6.607 1.007 1.990.886.043 Effective interest rate % 3.344 40.364 307.430 3.000 1.217.Performing .645.209 603.849 3.976.867 3.957 24.595 (2.453.Non Trading Book ------------------------------------------------------------------> NonUp to 1 >1 to 3 >3 to 6 >6 to 12 >1 to 5 Over interest month months months months years 5 years sensitive RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 7.726.820.531.755 7.365.974.049 2.356.258 1.197 522.42 3.867 6.000 24.630.723 26.896 243.249 498.108.042 460.395 689.861 310.Company No.007 150.000) 1.604 150.957 2.864) 7. 8515–D 54.464 143.28 3.140 3.338.317 2.27 5.878.482.938) (36.469 860.447) (4.820 12.142) 5.361.302 8. The following tables show the interest rate sensitivity gap.648) (9.760 18.805 269.124.879 8.211.33 - 21.331 6.609.83 3.567 2.000 575.618 200.720 2008 The Bank ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.961 357.428. by time bands. advances and financing .216) (2.533 7.729 61.201 560.626 66.706.87 5.726 7.181) (9.152.660 75.431 3.357.486.155.309. specific allowance and interest / income-in-suspense from gross non-performing loans outstanding.786 9. if earlier.879 (7.50 3.000 575.931.579 2.302 (5.572 1.700 3.85 5.799.729 4.038 6.651 43.435.293 6.800 12.543.447) 6.265.124.668 8.160 69.725.357.149.310 5.310 66.295 648.972 147.267.830 676.713 200.000 1.965.600 271.130.482.601.564 1.107.000 271.258 6.315. <------------------------------------------------------------. 115 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .726.22 5.651 2.369 3.124. on which interest rates of instruments are next repriced on a contractual basis or.369 35.258 6.271 1.754 390.700 4.974.979 1.490 131.533 (6.483 897.033.595 1.834 9.618.205.351 43.827 42.448 26.792 3.025.975 622 531.410.990.500 85.376 352.904) (1.267.417 5.830 70.789 485.630.473.360.204 1.000 128.000 2.59 3.612.

The secondary objective is to ensure an optimal funding structure and to balance the key liquidity risk management objectives.) LIQUIDITY RISK Liquidity risk is the risk that the organisation will not be able to fund its day-to-day operations at a reasonable cost. an assessment of potential cash flow mismatches that may arise over a period of one year ahead and the maintenance of adequate cash and liquefiable assets over and above the standard requirements of BNM . 8515–D 54. In the event of actual liquidity crisis occurring. customer base and maturity period. The primary objective of liquidity risk management is to ensure the availability of sufficient funds at a reasonable cost to honour all financial commitments when they fall due. significant drawdown of funds from previously contracted financing and purchase commitments. diversification of customer depositor base and inter-bank exposures. and to a lesser extent. 116 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .Management of cashflow. a Contingency Funding Plan provides a formal process to identify a liquidity crisis and detailing responsibilities among the relevant departments to ensure orderly execution of procedures to restore the liquidity position and confidence in the Group. . The ongoing liquidity risk management at the Group is based on the following key strategies: .Diversification and stabilisation of liabilities through management of funding sources. Liquidity risk exposure arises mainly from the deposit taking and borrowing activities. changes in portfolio as well as stress scenarios based on historical experience of large withdrawals. RISK MANAGEMENT POLICY (CONTD. a simulation on liquidity demands of new business. which includes diversification of funding sources.Scenario analysis.Company No.

000 575. advances and financing Other assets Amount due from originators Statutory deposit with Bank Negara Malaysia Deferred tax asset Investment in associated companies Prepaid land lease payments Property and equipment Intangible assets TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Other liabilities Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Term loan Stapled Capital Securities Irredeemable Non-Cumulative Convertible Preference Shares Total Liabilities Minority interests Shareholder's Equity TOTAL LIABILITIES AND EQUITY Net maturity mismatch Up to 1 month RM'000 17.063.109 7.312.462 122.196 66.153 (4.384.080 2.824.221 33.230 805 4.838 1.484 753.704 5.908 (10.576 12.242 825.471.820 11.359 477.407 2.872.725 60.747 784.037 1.464 565.050 276.704 (11.821 355.760.120.578 344.839 71.043.398 28 4.452.341.000 119.000 2.283.191 145.696 33 1.858 115.000 79.568.524.609 10.905 3.915 150.908 11.914.576 3.636 12.670.411 5.132 727.163 Nonspecific maturity RM'000 521 103.471.487 826.948 7.278 35.132 56.483 2.406 565.361 8.578 344.960.000 500.598.853 1.853 1.311 517.641.283.870.037 3.117.000 118.275) >1 to 3 months RM'000 220.166.051 171.230 805 171.341.380.689) Total RM'000 17.111 175.053.930 870.788 818.740.051 37.068) >3 to 6 months RM'000 150.361 (7.135 7.228.214 373.889 2.804 4.057 (12.734.680 25.000 400.386 1.426 477.225 28 4.960.102.597 5 8.387.447 421.000 575.918.407 84.704 13.368 825.105.196 66.727 84.249 25.460.479 955.566 31 1.Company No.145) >6 to 12 months RM'000 48.138.982.483 1.980 - 117 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .089. The following tables show the maturity analysis of the Group’s and the Bank’s assets and liabilities based on contractual terms: 2009 The Group ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.938 1.727 6.705.221 3.000 3.561.000 150.000 400.795.556 44 13.760.947.789 16.980 63.249 155.709.443 3.299) >1 to 5 years RM'000 51.638 33.850.982.629.277.106.820 500.060 155.486 82.617 1.739.098.607 597 23.792 728.000 145.216 7.057 35. 8515–D 54.096.439 277 2.623.926 56.431 703.914.872.050 1.460.782 31.313 Over 5 years RM'000 768.429 3.789 517.521.357 82.076 13.384 153.055.

331) >3 to 6 months RM'000 63.274 61.710 10.624 43.473.290 648.716.707 8. The following tables show the maturity analysis of the Group’s and the Bank’s assets and liabilities based on contractual terms: 2008 The Group ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.849 3.000 128.000 600.990 6.771.177 41 5.688.042 2.342 2.325.641 307.758 935.537.067 740 4.801 41 5.829.419 - 118 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .619.051.930.671.755 (7.265.514.508.998.492 1.710 4.705 29.021.913 200.251 26.668 14.749.515.064 1.469 860.687.563.318.486 4.108 682.446 452 18.067 740 169.880 286.003 (3.000 271.063) >1 to 3 months RM'000 1.436 28.877.497.204.688.248.378 1.404 169.490 131.545.595 460.406.648.272 Nonspecific maturity RM'000 101.254.914 7.669.909.657 1.314.469 860.000 1.177.386.726 57.070 23 10.361 344.490 9.979 1.709 (7.949 594.168 1.499 31.062 29.038 (7.419 352.156.197 645.532.440 1.042 1.867 4.651 769.604 150.767 1.853 577 26.038 10.306 8.248.024.577 77.007 1.792 4. 8515–D 54.977 516.174 85.331.254.961 357.000 575.418.000 689.000 71.250 772.670 1.739 1.536 307.755 9.174 1.243 243.410.771. advances and financing Other assets Amount due from originators Statutory deposit with Bank Negara Malaysia Deferred tax asset Investment in associated companies Prepaid land lease payments Property and equipment Intangible assets TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Other liabilities Subordinated term loans Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Term loan Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-Cumulative Convertible Preference Shares Total Liabilities Minority interests Shareholder's Equity TOTAL LIABILITIES AND EQUITY Net maturity mismatch Up to 1 month RM'000 10.791.404 33.197 645.223.369 1.496.637.030.274 61.818 70.785 7.430 3.021.000 600.670 656.683.741 8.255 6.140 1.267 379.841) >6 to 12 months RM'000 346.866 352.223.562 271.403) >1 to 5 years RM'000 2.499 (13.735 147.324.755 9.613 49.486 77.209 31.667.374 2.103.120 294.329.671.660 3.651 52.419 55.975 1.183.000 575.000 689.170 150.660.700 6.Company No.126.709 9.092.260 4.655.397 35.877.747 11.660.950 Over 5 years RM'000 2.167 2.820 432.239.007 1.584) Total RM'000 10.751 553.402 460.795 53.

246.000 60.246.514.704 4.600 1.620.061 563.533 652.050 276.338) 9.638 27.368 825.558 75.563 710.772.119 29.270.723.853 (6.078.927) 53.499 241.178 960.966 Over 5 years RM'000 768.127 (8.860 146. advances and financing Other assets Amount due from originators Statutory deposit with Bank Negara Malaysia Deferred tax asset Investment in subsidiaries companies Investment in associated companies Prepaid land lease payments Property and equipment Intangible assets TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Other liabilities Subordinated term loans Medium term notes Exchangeable bonds Term loan Stapled Capital Securities Irredeemable Non-Cumulative Convertible Preference Shares Total Liabilities Shareholder's Equity TOTAL LIABILITIES AND EQUITY Net maturity mismatch Up to 1 month RM'000 13.996 771.853 1.857.426 475.724 Total RM'000 13.914.199.963.747.052.908 18.899 3.100 1.564.900.186. The following tables show the maturity analysis of the Group’s and the Bank’s assets and liabilities based on contractual terms: 2009 The Bank ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.717 366.247 46.269.000 575.221 3.000 145.492 73.684.513 775.343.327 908.231.203 7.567 3.514.745 (9.537 >1 to 5 years RM'000 51.312 5.312 70.086.292 2.592.785.000 575.988 >6 to 12 months RM'000 622 20.500.583 245.000 3.732 11.787.970 11.853 1.053.865) 9.639 849.591 10.820 500.739 150.639 849.210.845 6.015.954 7.838 1.634.846 3.208) 2.499 241.029 >3 to 6 months RM'000 155.247 624.757 7.343.704.820 10.034 144.475 708.645.399 528.119 427.037 3.794 115.088 65.833 787.798 475.870 137 146.079 35.375 153.098) 6.857.460.846 70.460.789 431.Company No.549 5.002 29.789 13.600 1.080 1.186.037 1.023 (10.899.341 60.634.853 7.189 145.680 155.127 11.821 2.914.721 155.431 2.339 3.591 3.023 29.772.143 1.231.739 825.360 25.747 702.507.870 137 2.000 150.667.221 27.211 - 119 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .454 483.086.140.000 500.578.860 31.471 28.088 65.651 (2.282 Nonspecific maturity RM'000 102.211 25.685 >1 to 3 months RM'000 220.946.178 431.178 25.183.743.757.400.000 1.532 122.886 624. 8515–D 54.325 563.995.592.745 10.000 66.

666.361.835.162.504.755 8.124.570 (2. advances and financing Other assets Amount due from originators Statutory deposit with Bank Negara Malaysia Deferred tax asset Investment in subsidiary companies Investment in associated companies Prepaid land lease payments Property and equipment Intangible assets TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Other liabilities Term loan Subordinated term loans Medium term notes Subordinated bonds Exchangeable bonds Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-Cumulative Convertible Preference Shares Total Liabilities Shareholder's Equity TOTAL LIABILITIES AND EQUITY Net maturity mismatch Up to 1 month RM'000 8.000 575.342) 6.830 70.245.927.357.542 415.448 26.490 1.666) 3.460 648.473.873 846.464 344.143 691.649.657.067.573 35.876 66.738.251.990 6.636 40.120 2.000 (6.483.705 24.867 6.208.412.554 1.007 1.000 8.000 200.288 1.265.500 250.280 26.238.217.064 1.067.913 200.422 1.668 12.271 1.365.455.000 200.505.162.615.608.258 1.120 262.613.613 1.726 57.876 4.408.361.545 494.554 42.748.613.190 Total RM'000 8.440 >6 to 12 months RM'000 2.630.244.000.380 53.242 5.193 28.869 137 3.417 3.140 1. 8515–D 54.337 (6.595 1.193 143.618 26.490 8.175.626 66.469 860.473.357.114.896 243.659.632 352.000 575.469 860.000 1.969.423 307.376 352.661 3.169.338.560.302 271.337 8.504.729 271.292 60.392 >3 to 6 months RM'000 69.867 3.924 676.820 334.651 688.149.864 1.835.043 - 120 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .808.560) 7.388.959 85.237 2.458.675 269.115.736 4.445.000 61.Company No.849 3.337 Nonspecific maturity RM'000 101.351 213.338 147.767 1.405 553.007 1.212 339.125) 6.280 (12.388.149.834 6.330.858 Over 5 years RM'000 2.430 3.042 1.380) 48.417 8.417 5.869 137 143.729 150.910 1.601. The following tables show the maturity analysis of the Group’s and the Bank’s assets and liabilities based on contractual terms: 2008 The Bank ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities available-for-sale Securities held-to-maturity Derivative financial assets Loans.651 44.671 >1 to 5 years RM'000 622 1.497 483.062 24.043 24.896.441 516.070 9.734 9.695.961 357.806 9.293 6.000 128.613 646.429.365.734 (5.323 577 26.859.292 60.155 >1 to 3 months RM'000 1.126.873 846.042 2.979 1.364 307.799.472.604 150.212 452 14.497 483.000 131.792 3.613.080 1.

to a lesser extent. including a group risk appetite framework that are approved by the Board or risk committee. Expected Default Frequencies are calibrated to the internal rating model. disrupt or otherwise resulting in financial and reputational risk. assess the relevant controls to minimise the impact of such risk through the initiation of risk mitigating measures and policies. unenforceability of contracts. For retail credits. OPERATIONAL RISK MANAGEMENT Operational risk is the potential loss from a breakdown in internal process. Exposure to credit risk arises primarily from lending and guarantee activities and.hire purchase and credit card applications is being used to complement the credit assessment process. lawsuits. may lead to the incurrence of losses. staff training and assessments.) CREDIT RISK MANAGEMENT Credit risk is the risk of loss due to the inability or unwillingness of a counterparty to meet its payment obligations. Lending activities are guided by internal group credit policies and guidelines. The Group minimises operational risk by putting in place appropriate policies. These portfolio management strategies are designed to achieve a desired and ideal portfolio risk tolerance level and sector distribution over the next few years. The model consists of quantitative and qualitative scores which are then translated into nine rating grades. 8515–D 54. Fpr non-retail credit portfolio management strategies and significant exposures are reviewed and/ or approved by the Board. deficiencies in people and management or operational failure arising from external events. It is increasingly recognised that operational risk is the single most widespread risk facing financial institutions today. in consultation with external legal counsel to ensure that legal risk is minimised. Credit risk is quantified based on Expected Default Frequencies and Expected Losses on default from its portfolio of loans and off-balance sheet credit commitments. provision of advice and dissemination of information. The primary objective of the credit risk management framework is to ensure that exposure to credit risk is always kept within its capability and financial capacity to withstand potential future losses. Regulatory risk is managed through the implementation of measures and procedures within the organisation to facilitate compliance with regulations. RISK MANAGEMENT POLICY (CONTD. Legal risk is managed by internal legal counsel and where necessary. a credit-scoring system to support the housing. Legal risk arises from the potential that breaches of applicable laws and regulatory requirements. prescription of controls to minimise these risks. These are supported by independent reviews by the Group’s Internal Audit team. Operational risk management is the discipline of systematically identifying the critical potential risk points and causes of failure. a more aggressive approach towards reducing existing high-risk exposures and exposures to certain sectors. presettlement and settlement exposures of sales and trading activities. These portfolio management strategies include minimum credit rating targets from new facilities.Company No. systems. Specific procedures for managing credit risks are determined at business levels in specific policies and procedures based on risk environment and business goals. Risk management begins with an assessment and rating of the financial standing of the borrower or counterparty using a credit rating model. 121 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . internal controls and procedures as well as maintaining back-up procedures for key activities and undertaking business continuity planning. or adverse judgement. LEGAL AND REGULATORY RISK The Group manages legal and regulatory risks to its business. These include a compliance monitoring and reporting process that requires identification of risk areas.

As the value of these financial derivatives are principally driven by interest rate and foreign exchange rate factors. Hence. exposures on derivatives are aggregated or netted against similar exposures arising from other financial instruments engaged by the Group. For revenue purposes. The principal interest rate contracts used are interest rate swaps. of equivalent amounts of two currencies and a commitment to exchange interest periodically until the principal amounts are re-exchanged on a future date. futures. 122 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . 8515–D 54. Forward rate agreements are contracts for the payment of the difference between a specified interest rate and a reference rate on a notional deposit at a future settlement date. options and combinations of these instruments. The Group’s involvement in financial derivatives is currently focused on interest rate. or notional exchange. A cross currency swap generally involves the exchange. They include swaps. forward rate agreements. mainly market risks. Financial derivatives is one of the financial instruments engaged by the Group both for revenue purposes as well as to manage the Group’s own market risk exposure. As part of the asset and liability exposure management. There is no exchange of principal. An interest rate futures is an exchange traded contract whose value is based on the difference between a specific interest rate and a reference rate on a notional deposit or fixed income security at a future settlement date.) RISK MANAGEMENT POLICY ON FINANCIAL DERIVATIVES Purpose of engaging in financial derivatives Financial derivative instruments are contracts whose value is derived from one or more underlying financial instruments or indices.equity and foreign exchange rate derivatives. The principal exchange rate contracts used are forward foreign exchange contracts and cross currency swaps. Derivatives are contracts that transfer risks. within acceptable limits. The Group also takes conservative exposures.Company No. Interest rate swap transactions generally involve the exchange of fixed and floating interest payment obligations without the exchange of the underlying principal amounts. to carry an inventory of these instruments in order to provide market liquidity and to earn potential gains on fluctuations in the value of these instruments. An equity option is a financial derivative that represents a contract sold by one party (option writer) to another party (option holder). the Group uses them to reduce the overall interest rate and foreign exchange rate exposures of the Group. Forward foreign exchange contracts are agreements to buy or sell a specified quantity of foreign currency on a specified future date at an agreed rate. RISK MANAGEMENT POLICY (CONTD. the Group maintains trading positions in these instruments and engages in transactions with customers to satisfy their needs in managing their respective interest rate. but not the obligation to buy (call) or sell (put) an equity at an agreed-upon price (the strike price) during a certain period of time or on a specific date (exercise date). The contract offers the buyer the right. The Group manages these risks on a portfolio basis. equity and foreign exchange rate exposures. These are performed by entering into an exposure in derivatives that produces opposite value movements vis-à-vis exposures generated by other non-derivative activities of the Group. the Group uses derivatives to manage the Group’s market risk exposure. Derivative transactions generate income for the Group from the buy-sell spreads. interest rate futures and forward rate agreements. The principal equity contracts used are equity option.

and obtaining collateral where appropriate. 8515–D 54.Company No. Market risk of derivatives used for trading purposes Market risk arising from the above interest rate-related and foreign exchange-related derivative contracts measures the potential losses to the value of these contracts due to changes in market rate/prices. Value at risk. and the Group manages these risks in a consistent manner under the overall risk management. The contractual amounts of these contracts provide only a measure of involvement in these type of transactions and do not represent the amounts subject to market risk. the Group’s financial loss is not the entire contracted principal value of the derivatives. Value at risk method is used to measure the market risk from these contracts. RISK MANAGEMENT POLICY (CONTD. setting credit limits on exposures to counterparties. they expose the holder to the same type of market and credit risk as other financial instruments. is a statistical measure that estimates the potential changes in portfolio value that may occur brought about by daily changes in market rates over a specified holding period at a specific confidence level under normal market conditions. Unlike conventional asset instruments.) Risk associated with financial derivatives As derivatives are contracts that transfer risks. 123 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . Credit risk of derivatives Counterparty credit risk arises from the possibility that a counterparty may be unable to meet the terms of the derivatives contract. The Group will only suffer a replacement cost if the contract carries a fair value gain at time of default. Exposure to market risk may be reduced through offsetting on and off-balance sheet positions. but rather a fraction equivalent to the cost to replace the defaulted contract with another in the market. The cost of replacement is equivalent to the difference between the original value of the derivatives at time of contract with the defaulted counterparty and the current fair value of a similar substitute at current market prices. The Group limits its credit risk within a conservative framework by dealing with creditworthy counterparties.

536 53. 8515–D 55.484 857.106. other than a forced or liquidated sale.496 1. In addition.928 58.814 1.419 1.427 76.280 2. FAIR VALUES OF FINANCIAL INSTRUMENTS Financial instruments are contracts that give rise to both a financial asset of one enterprise and a financial liability or equity instrument of another enterprise.868.254. The information presented herein represents best estimates of fair values of financial instruments at the balance sheet date.359 57.387.323.329.520 385.156.430.683.673 84.667 124 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .447 10.411 5.670 421. quoted and observable market prices are used as the measure of fair values.349.500 53. Where such quoted and observable market prices are not available.307 116. fair value information for non-financial assets and liabilities such as investments in subsidiary companies and deferred taxation are excluded. Where available.109 84.416. The fair value of a financial instrument is the amount at which the instrument could be exchanged or settled between knowledgeable and willing parties in an arm’s length transaction.447 17. The estimated fair values of the Group's and the Bank's financial instruments are as follows: 2009 The Group Carrying Value RM'000 Fair Value RM'000 Carrying Value RM'000 2008 Fair Value RM'000 Financial Assets Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for -trading Securities available-for-sale Securities held-to-maturity Loans.331.739 1.430.106.447 1.635.788. estimates of future cash flows and other factors.411 5. advances and financing * Other financial assets Non-financial assets TOTAL ASSETS 17.700 6.899 77.980 422.598.329.598. discount rates.484 753. Changes in the assumptions could materially affect these estimates and the corresponding fair values.109 85.050 1.113. fair values are estimated based on a number of methodologies and assumptions regarding risk characteristics of various financial instruments.Company No.852 1.323.225.771.168 1.313.045 1.771.670 10.683.209 2.341.739 1. which requires the fair value information to be disclosed. as they do not fall within the scope of FRS132 (Financial Instruments: Disclosure and Presentation).387.443 77.165.910.610 6.

106.586 1.000 (2008: RM840.266 1.000 500.000 79.270 1.106 1.271 1.000) has been included under non-financial assets.209 70.794 48.124.563 810.258 1.419 7.898.196.909.820 471.887.716 1.136.119 13.634.549 5.490 630.853 1.000 600.473.730 2.338.213 5.460.364 5.724.119 8.967 951.925 1.884 271. advances and financing * Other financial assets Non-financial assets TOTAL ASSETS 13.053.549 5.422.968.142 624.757 66.341.181 2.244 70.211 428.000 575.979 1.435 8.043 1.772.820.338.000 71.125 1.139.162 28 670.Company No.563 710.909.063 62.143 1.801.115.249 129.339 150.030.000 575.675.798 47.434 37.460.258 1.272.604 150.800 632.741 55.364 44.000 271.293 6.042 460.120.120.655.243 243.628.328 45. 8515–D 2009 Carrying Value RM'000 Financial Liabilities Deposits from customers Deposits and placements of banks and other financial institutions Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Other financial liabilities Subordinated term loans Term loans Hybrid securities Medium term notes Subordinated bonds Exchangeable bonds Stapled Capital Securities Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-cumulative Convertible Preference Shares Non-Financial Liabilities Other non-financial liabilities Minority interests Share capital Reserves TOTAL LIABILITIES AND EQUITY * Fair Value RM'000 Carrying Value RM'000 2008 Fair Value RM'000 63.261 732.249 155.563 145.475 133.000 131.431 1.500.407 The general allowance for the Group amounting to RM895.042 552.348.000 400.820 825.753.053.209 69.490 689.922.000 79.365.540 145.333.695 860.980 7.939 125 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .866 1.243 239.177.901 150.124.363 4.367 41 610.469 860.061 606.189.741 65.907 1.045.985 77.364 3.917 84.183.773 66.203 6.254.490.947.574.183.231 7.812. 2009 The Bank Carrying Value RM'000 Fair Value RM'000 Carrying Value RM'000 2008 Fair Value RM'000 Financial Assets Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for -trading Securities available-for-sale Securities held-to-maturity Loans.135 63.136.037 1.641.465 2.599 1.000 71.812.602 55.745.424 456.183.613 8.634.808.365.183.613 427.619.000 150.330.406 2.533.

339 150. The fair value of contingent liabilities and undrawn credit facilities are not readily ascertainable.475 131.507.113. These financial instruments are presently not sold or traded.736 1.601.000 150.472.473.647 471.211 6.490 860.750. The estimated fair value may be represented by the present value of the fees expected to be received. They generate fees that are in line with market prices for similar arrangements.745.680 129.896 239.709. (b) Deposits and Placements with Banks and Other Financial Institutions The fair values of deposits and placements with banks and other financial institutions ("Deposits") with remaining maturities less than six months are estimated to approximate their carrying values.000 66.701 The general allowance for the Bank amounting to RM728.361. The Group assess that their respective fair values are unlikely to be significant given that the overall level of fees involved is not significant and no allowances is necessary to be made.626 66.000 200.857. the fair value are estimated based on discounted cash flows using the prevailing KLIBOR rates and interest rate swap rates.364 3.700.106 1.000 575.000 606.948 3.170 6.469 271.899 670. 8515–D 2009 Carrying Value RM'000 Financial Liabilities Deposits from customers Deposits and placements of banks and other financial institutions Bills and acceptances payable Recourse obligation of loans sold to Cagamas Berhad Other financial liabilities Subordinated term loans Term loans Medium term notes Subordinated bonds Exchangeable bonds Stapled Capital Securities Irredeemable Convertible Unsecured Loan Stocks Irredeemable Non-cumulative Convertible Preference Shares Non-Financial Liabilities Share capital Shareholder's Equity TOTAL LIABILITIES AND EQUITY * Fair Value RM'000 Carrying Value RM'000 2008 Fair Value RM'000 53.914.186.376 1.896 243.579 271.775 6.772.217.387. shortterm in nature or frequent repricing.767.702. For Deposits with maturities of more than six months.149.800 200.Company No.390.043 133.587.716 1.000 6.339 825.361. The following methods and assumptions were used to estimate the fair value of assets and liabilities as at 31 March 2009 and 31 March 2008: (a) Cash And Short-Term Funds The carrying values are a reasonable estimate of the fair values because of negligible credit risk.460.845 52.658 48.901 150.000 61.801.680 155.820 1. 126 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .853 145.364 4.820 1.000 500.490 860.000.199.709.262 5.645.604 150.325 1.895 1.261 732.000) has been included under non-financial assets.000 575.312 70.008.000 (2008: RM684.000 66.755.424 624.736 1.925 145.867 48.037 1.183. less associated costs and potential loss that may arise should these commitments crystallise.748 1.507.417 610.979 1.000 61.

Deposits of Banks and Other Financial Institutions and securities sold under repurchase agreements The fair value of deposit liabilities payable on demand (“demand and savings deposits”) or with remaining maturities of less than six months are estimated to approximate their carrying values at balance sheet date. The fair value of borrowings with remaining maturities of more than six months are estimated based on discounted cash flows using market indicative rates of instruments with similar risk profiles or quoted prices at balance sheet date. Exchangeable Bonds. the estimated future cash flows are discounted using market indicative rates of similar instruments at the balance sheet date. Advances And Financing (“Loans And Financing”) The fair value of variable rate loans and financing are estimated to approximate their carrying values. (h) Subordinated term loans. the fair values are deemed to approximate the carrying value. the fair values are estimated based on expected future cash flows of contractual instalment payments and discounted at prevailing indicative rates adjusted for credit risk. 127 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . negotiable instrument of deposits and securities sold under repurchase agreements with remaining maturities of more than six months are estimated based on discounted cash flows using KLIBOR rates and interest rate swap rates. As assumptions were made regarding risk characteristics of the various financial instruments. (d) Loans. are estimated to be at par value. In respect of non-performing loans and financing. which are considered short term in nature. including discounted cash flow models and option pricing models. future expected loss experience and other factors. Redeemable Unsecured Subordinated bonds. taking into consideration the underlying collateral values. including recent market transactions and valuation techniques. net of specific allowance for bad and doubtful debts and financing. the fair value is estimated using net tangible assets techniques. Where discounted cash flow techniques are used. (f) Recourse Obligation on Loans Sold To Cagamas Berhad The fair values for amount due to Cagamas Berhad are determined based on discounted cash flows of future instalment payments at prevailing rates quoted by Cagamas Berhad as at balance sheet date. The fair value of term deposits. Term Loans and Stapled Capital securities ("Borrowings") The fair value of borrowings with remaining maturities of less than six months are estimated to approximate their carrying values at balance sheet date. (i) Derivative Financial Instruments The fair values of derivative financial instruments are obtained from quoted market prices in active markets. as appropriate. Hybrid securities. 8515–D (c) Securities Held-For-Trading. changes in the uncertainties and assumptions could materially affect these estimates and the resulting value estimates. Where such quoted or observable market prices are not available. For fixed rate loans and financing. The fair values of unquoted debt equity conversion securities which are not actively traded. (g) Bills and Acceptances Payables The carrying values are reasonable estimate of their fair values because of their short-term nature. are estimated to be approximately their carrying value. Medium Term Notes. Securities Available-For-Sale And Securities Held-To-Maturity The estimated fair value is based on quoted or observable market prices at the balance sheet date. The fair value of the other financial assets and other financial liabilities. ICULS. INCPS.Company No. discount rates. (e) Deposits From Customers.

456.356 4.787) 500. the Bank adopted Bank Negara Malaysia’s Circular on the Reclassification of Securities under Specific Circumstances which allow banking institutions to reclassify securities in held-for-trading category under the Revised Guidelines of Financial reporting for Licensed Institutions (BNM/GP 8).200 Increase/ (Decrease) reclassification 1.808 RM’000 RM’000 22.342.153.200) 17.060 (145. The provisions in this Circular shall override the existing requirements of BNM/GP8 in relation to the reclassification of securities into or out of the held-for-trading category and are effective from 1 July 2008 until 31 December 2009.542) 1.The effects of the reclassification were as follows: Before reclassification Increase/ (Decrease) in reclassification After reclassification RM’000 Effect on Balance Sheet as at 30 September 2008 The Group and the Bank Securities held-for-trading Securities available for sale Available for sale reserve Unappropriated profits RM’000 RM’000 1. 8515–D 56. The balances as at 31 March 2009 relating to securities reclassified in the second quarter of financial year 2009 are: Carrying value RM’000 The Group and the Bank as at 31 March 2009 Securities reclassified Fair value RM’000 Mark-to-market loss taken up in Available for sale reserve RM’000 531.200 22.342) 1.000) 17.075 Before reclassification After reclassification RM’000 Effect on Income Statement for the period ended 30 September 2008 The Group and the Bank Revenue Other operating income Taxation Profit after taxation 2.336 28.175 42.000 and RM 500.793 (156.593) 400.860 (140.135.198 The carrying value and fair value as at 30 September 2008 for securities reclassified were RM 581. 128 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .000 respectively.569 5.177.956.Company No.373 489.787 (22.364. RECLASSIFICATION OF SECURITIES During the 2nd quarter of financial year 2009.678.008 There was no further reclassification of securities after the second quarter of financial year 2009.006 (134.593) 418.136 5.875 (500.200 2.200 (5.787.453.

companies or any legal entities which control. CREDIT EXPOSURES ARISING FROM CREDIT TRANSACTIONS WITH CONNECTED PARTIES The Group 2009 Outstanding credit exposures connected parties (RM'000) with 762.195 The Bank 2008 422. (g) subsidiary of.Company No. 8515–D 57. or are controlled by.22 The credit exposures above are derived based on Bank Negara Malaysia's revised Guidelines on Credit Transactions and Exposures with Connected Parties.14 0. or in which they have interest as a director. the terms and conditions of credit transactions with connected parties are not more favourable than those entered into with other counterparties with similar circumstances and creditworthiness. a connected party refers to: (a) directors of the Bank and their close relatives.26 0.37 0. any person (including close relatives in the case of individuals) listed in (a) to (d) above. the underwriting and acquisition of equities and private debt securties. executive officer. 129 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .85 0. agent or guarantor. (d) officer and his close relatives.67 1.25 0. (b) controlling shareholder and his close relatives. partner.902 2009 745. and their subsidiaries or entities controlled by them. (iii) the credit transactions are in the interest of the Bank and approved by the Board of Directors with not less than three quarters of all board members present. Under the guidelines. executive officer refers to member of management having authority and responsibility for planning. either as a member of a committee or individually. Credit transactions and exposures to connected parties disclosed includes the extension of credit facility and/or off-balance sheet transactions that give rise to credit/counterparty risk. (c) executive officer and his close relatives. or an entity controlled by the Bank and its connected parties. Credit transactions entered into with connected parties are on arm's length basis whereby: (i) (ii) the creditworthiness of the connected party is not less than what is normally required of other persons.113 2008 429. (f) any person for whom the persons listed in (a) to (d) above is a guarantor. directing and/or controlling the activities of the Bank. partnerships.22 0. which are effective for the financial year 2009. (e) firms. officer refers to those responsible for or have the authority to appraise and/or approve credit transactions or review the status of existing credit transactions.788 Percentage of outstanding credit exposures to connected parties as proportion of total credit exposures (%) Percentage of outstanding credit exposures with connected parties which is non-performing or in default (%) 1.

certain incidental expenses which were incurred in the acquisition of housing loans and commercial property loans and were previously taken up under Other operating expenses are now deducted against interest income earned from the said loans. (b) (c) (d) The above classifications are to conform with current year presentation which better reflects the nature of the items. advances and financing. the Group had completed the Business Transfer based on the book value of the assets and liabilities as at 11 April 2008 pursuant to the Business Transfer Agreement dated 11 March 2008 entered into with AmInvestment Bank Berhad. On 12 April 2008. credit card receivables under instalment payment scheme which were previously classified under Other Assets have been reclassified as part of Loans.Company No. Under the pooling of interest method. The rationale for the reclassification is to facilitate better peer comparisons as the reclassification is in line with industry practice. are included into the financial statements of the Group and the Bank as if the merger had been effected prior to and throughout the current financial year. Arising from this. deposits for certain depositors classified under Deposits and placements of banks and other financial institutions were reclassified to Deposits from customers. interest expense attributable to these depositors were reclassified from Interest expense on Deposits and placements of banks and other financial institutions to Interest expense on Deposits from customers. 8515–D 58 RESTATEMENT OF COMPARATIVES The Group and the Bank had reviewed and changed the presentation of certain balances as follows: (a) certain balances which represent cash held by outsourcers and were previously included in Other assets are now reclassified and presented as part of cash and short term funds. 130 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 . the transaction has been accounted for via the pooling of interest method. together with the assets and liabilities arising thereto. As the vesting of assets and assumption of liabilities were carried by entities under common control. the results and financial position of the business transferred from AmInvestment Bank. Accordingly comparative figures of the Group and the Bank have been restated.

739 1.490 1.683.891 266.526.800) 4.851. advances and financing Other assets Statutory deposit with Bank Negara Malaysia Deferred tax asset Property and equipment Intangible assets LIABILITIES Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Recourse obligation on loans sold to Cagamas Berhad Other liabilities Term loan Reserves Effect of other reclassifications RM’000 As restated RM’000 8.912.250 807.486 41.545 6.964.410) - 8.211 133.789) - 1.Company No.786 7.106.968.988 4.933.331.211.771.755 499.007 152.712.536 307.062 10.402 271.351 - 243.651 52.353 1.197 645.670 1.862 35.866 352.007 208.771.156.856 235.439 510 2 120.247 119.255.410 55.500 1.839 1.507 629.067 169.141.979 1.213 131 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .177.274 61.140 46.168 1.537 1.949.385 85.484 (638.628 168.413 656.700 6.115 1.329. 8515–D 58 RESTATEMENT OF COMPARATIVES (CONTD.316.619.516 863.660.690 15.348 (7.232.659 3.741 12.680 71.490 5.535.497.451.727 (207.492 1.) The comparative amounts which have been restated due to the above are as follows: Effect of change arising from pooling of interest method RM’000 As previously stated RM’000 The Group Balance Sheet as at 31 March 2008 ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities availablefor-sale Securities held-to-maturity Derivative financial assets Loans.851.255 87.663 47.764 61.325.399 271.003 3.751.

671.209 87.908 (2.173) 493.013 148.869 132 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .210. advances and financing Other assets Statutory deposit with Bank Negara Malaysia Deferred tax asset Investment in subsidiary companies 7.900 3.028 305.388.) The comparative amounts which have been restated are as follows (contd.527) (1.014) (119.800) 4.858 458.238.529 813.192.713 1.651 44.692) 40. 8515–D 58.709) (14.633) Effect of other reclassifications RM’000 As restated RM’000 609.143 726.452.344 33.474) - 1.873 846.020 85.141 (902.497 483.948.): Effect of change arising from pooling of interest method RM’000 As previously stated RM’000 The Group Income Statement for the financial period ended 31 March 2008 Interest Income Interest Expense Net income from Islamic Banking business Other operating income Other operating expenses Allowance for losses on loans.411.413 656.128 119.753) (83. RESTATEMENT OF COMPARATIVES (CONTD.902 235.271 1.074) 36.780 1.330.621 (1.641) (58.865) 533.412 (172.073 (415.269.777.756) - (517.101) (271.204.306 70.849 (638.293 6.641) (329. advances and financing Impairment loss Provision for commitments and contingencies Taxation 3.718 751.338.988 4.258 1.115.628) (1.124.739 (36.364 307.365.307 468.062 8.462 71.830) The Bank Balance Sheet as at 31 March 2008 ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Securities held-for-trading Securities availablefor-sale Securities held-to-maturity Derivative financial assets Loans.059 1.442) (553.727 (857.613 1.804.414 (59.786) (114) 14.478 119.Company No.977.093 1.663 39.220 376.190 15.342 867.210.

8515–D 58.436) - 6.016 (2.786) 14.615 266.087) (83.571 (694.806.128 (402.527) 296 (49.816.348 (6.591) 67.792.674 (1.730) Effect of other reclassifications RM’000 As restated RM’000 36.615 271.Company No.007 208.106.): Effect of change arising from pooling of interest method RM’000 As previously stated RM’000 Balance Sheet as at 31 March 2008 LIABILITIES Deposits from customers Deposits and placements of banks and other financial institutions Derivative financial liabilities Recourse obligation on loans sold to Cagamas Berhad Other liabilities Term loan Reserves Income Statement for the financial period ended 31 March 2008 Interest Income Interest Expense Other operating income Other operating expenses Allowance for losses on loans.436 48.591.262 591.329 35.316 (656.787) 34.394) 133 AmBank (M) Berhad Financial Statements For The Year Ended 31 March 2009 .777.933 - 243.490 4.692) (119.940 5.725) 296 (254.979 1.180.601.114 2.597.786 3.197 85.318.210.681) 304.806.390.272) 371.395 (36.607) - (379.729 271.867 9.255 (52.491 6. RESTATEMENT OF COMPARATIVES (CONTD.376 352.304.659 3.) The comparative amounts which have been restated are as follows (contd.787.357.198) (204. advances and financing Impairment loss Provision for commitments and contingencies Taxation 3.217.490 1.140 39.960) (14.904) (414.839 1.

Mid Valley City Lingkaran Syed Putra 59200 Kuala Lumpur Malaysia CENTRAL DEPOSITORY AND PAYING AGENT Bank Negara Malaysia Jalan Dato’ Onn 50480 Kuala Lumpur Malaysia . Jalan Tun Razak Off Persiaran Hampshire 50400 Kuala Lumpur Malaysia] LEGAL COUNSEL FOR THE PRINCIPAL ADVISER. The Boulevard. 9th Floor. Bangunan AmBank Group 55 Jalan Raja Chulan 50200 Kuala Lumpur Malaysia PRINCIPAL ADVISER. LEAD ARRANGER & LEAD MANAGER Adnan Sundra & Low Level 21. Megan Avenue I No. 189. LEAD MANAGER & FACILITY AGENT AmInvestment Bank Berhad nd 22 Floor. Menara Olympia No.THE ISSUER AmBank (M) Berhad nd 22 Floor. Bangunan AmBank Group 55 Jalan Raja Chulan 50200 Kuala Lumpur Malaysia TRUSTEE Pacific Trustees Berhad Unit A-9-8. 8 Jalan Raja Chulan 50200 Kuala Lumpur Malaysia RATING AGENCY RAM Rating Services Berhad 19-G. LEAD ARRANGER.

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