INTRODUCTION

BANK MUAMALAT

Islamic banking is a broader financial management activity that is based on Islamic

law or Shariah principles. Islamic banking has the same purpose as conventional
banking except that it operates in accordance with the rules of Shariah known as
Fiqh al-Muamalat (Islamic rules on transactions) to avoid the exploitative element of
the interest (riba) system. The basic principle of Islamic banking is the sharing of
profit and loss and the prohibition of riba. Amongst the common Islamic concepts
used in Islamic banking are profit sharing (Mudharabah), safekeeping (Wadiah),
joint venture ( M u s h a r a k a h ) , c o s t - p l u s ( M u r a b a h a h ) , d i m i n i s h i n g
p a r t n e r s h i p ( M u s h a r i k a h Mutanakisah) and leasing (Ijarah). Historically,
Islamic banking took off globally towards the end of the century with the
introduction of the Islamic Development Bank in Jeddah in 1970. In 1974 with the
Islamic Bank of Dubai being the first ever Islamic bank to be launched. The
earliest form of Islamic banking in Malaysia can be traced to the setting up of the
Perbadanan Wang Simpanan Bakal-Bakal Haji (Pilgrimage Fund), the precursor to
the present-day Tabung Haji. The National Steering Committee on Islamic Bank
was established in July 1980 culminating in the establishment of Bank Islam
Malaysia Berhad in 1983. In 1993, commercial banks, merchant banks and finance
companies. were allowed to offer Islamic banking products and services under the
Islamic Banking Scheme (IBS) in the country.

AFFIN BANK

AFFIN Holdings Berhad (AHB) was incorporated in Malaysia on 31 May 1975 as a

private limited company under the name of I.M.A Sdn Bhd. It started off as a credit
company providing hire-purchase financing for motor vehicles. On 15 September
1978, it changed its name to AFFIN Motor and Credit Finance (Malaysia) Sdn Bhd.
Subsequently it changed its name again to AFFIN Credit (Malaysia) Sdn Bhd on 16
January 1979 and thereafter to AFFIN Holdings Sdn Bhd on 2 March 1991. It was
converted into a public company under its present name on 6 May 1991. In the last
decade, AHB has changed substantially in terms of group organisation structure
through a series of mergers and acquisitions which had been undertaken to facilitate
AHB's status as the flagship financial services subsidiary of its major shareholder,
Lembaga Tabung Angkatan Tentera (LTAT).

PASTEL Analysis
PASTEL Analysis for AFFIN BANK BERHAD

Political
1.Political stability can influence the finance and banking industry of a nation in
terms of monetary rate, investment, loan – pay offs
2. Rules and regulations that embodied the industry in terms of licensing ,
connection with ministry of finance, and BNM.

Economic
1.Moderation in economic growth
2.The declining rate of inflation
3.Expansion of private consumption and business spending
4.Expected continuous income growth

Sosial
1.The increased demand for fast banking financing services
2.Increased financial transection via online with the threat of security breach.
3.The needs for younger generation for banking and financial products that suits
with their lifestyle, such as, rewards and freebies.
4.Individual that are seeking for profitable investment package such as Gold
Invesment.

Technology
1.Internet Banking
2.Phone Banking
3. Cash Deposit Machine (CDM)

Legal
1.Rules and regulations that govern banking and financial institutions, such as
Banking and Financial Act 1989(BAFIA), Hire Purchase Act 1967, Islamic Banking
Act 1983.
2.The potential evaluation of tranfoming the KL Regional Centre for Arbitration into
a global arbitration centre.

Environment
1.ASEAN central banks have made major headway in support ofeconomic
integration through the ASEAN Economic Community (AEC). The central bank has
endorsed a high level framework to advance economic and financial integration.
2Investments banking in anticipated to maintain strong growth of 15 per cent
annum throughtout 2010-2015, before moderating to 10 per cent in 2016-2020.
3.The Asset and wealth management industries are expected to achieve an
average of 8% in 2010-2020.

PASTEL Analysis for Bank Muamalat

PESTEL Analysis is a framework used to scan an organization’s external macro
environment. For the
first factor, i.e. the political factor, the ongoing financial instability in the world
had led the
government in Malaysia to take an action to strengthen the country’s position
as a global Islamic
financial center, by giving incentives to this sector to growth. As a pioneer in the
market, Bank Islam
has taken initiatives to strengthen the country’s position in global Islamic financial
services industry.
The second analysis pertains to economic factors. Due to shifting of
economies landscape from
collision of the macro-prudential measures, Bank Islam has been focusing on
growth in these areas
and at the same time innovating and adapting to cater the customer needs in
this situation. The
third analysis is about social factor, because customers are becoming aware
of the economic
condition and the role of the ‘halal’ market, especially from the religious standpoints
of the Muslim
customers in Malaysia, Bank Islam is adapting to these changes by accommodating
the products and
service from the angles of the implications of Shariah. The fourth analysis is
focused on the
technological factors. The development and introduction of online banking and
Automated Teller
Machines (ATM) have provided convenience and ease for customers, which in
turn have reduced
customer service time. The fifth analysis is about the legal factors. The
government policies and
legislations also directly impact the performance of Bank Islam as all the local banks
in Malaysia are
regulated under the system of Bank Negara Malaysia. As regards the last
analysis, which is about
the environmental factors, it is worth-mentioning that the Bank Islam is
committed to save the
environment through its various corporate social responsibility programs.
PESTEL Analysis is a framework used to scan an organization’s external macro
environment. For the
first factor, i.e. the political factor, the ongoing financial instability in the world
had led the
government in Malaysia to take an action to strengthen the country’s position
as a global Islamic
financial center, by giving incentives to this sector to growth. As a pioneer in the
market, Bank Islam
has taken initiatives to strengthen the country’s position in global Islamic financial
services industry.
The second analysis pertains to economic factors. Due to shifting of
economies landscape from
collision of the macro-prudential measures, Bank Islam has been focusing on
growth in these areas
and at the same time innovating and adapting to cater the customer needs in
this situation. The
third analysis is about social factor, because customers are becoming aware
of the economic
condition and the role of the ‘halal’ market, especially from the religious standpoints
of the Muslim
customers in Malaysia, Bank Islam is adapting to these changes by accommodating
the products and
service from the angles of the implications of Shariah. The fourth analysis is
focused on the
technological factors. The development and introduction of online banking and
Automated Teller
Machines (ATM) have provided convenience and ease for customers, which in
turn have reduced
customer service time. The fifth analysis is about the legal factors. The
government policies and
legislations also directly impact the performance of Bank Islam as all the local banks
in Malaysia are
regulated under the system of Bank Negara Malaysia. As regards the last
analysis, which is about
the environmental factors, it is worth-mentioning that the Bank Islam is
committed to save the
environment through its various corporate social responsibility programs.
PESTEL Analysis is a framework used to scan an organization’s external macro
environment. For the first factor, i.e. the political factor, the ongoing financial
instability in the world had led the government in Malaysia to take an action
to strengthen the country’s position as a global Islamic financial center, by
giving incentives to this sector to growth. As a pioneer in the market, Bank Islam
has taken initiatives to strengthen the country’s position in global Islamic financial
services industry. The second analysis pertains to economic factors. Due to
shifting of economies landscape from collision of the macro-prudential
measures, Bank Islam has been focusing on growth in these areas and at the
same time innovating and adapting to cater the customer needs in this
situation. The third analysis is about social factor, because customers are
becoming aware of the economic condition and the role of the ‘halal’ market,
especially from the religious standpoints of the Muslim customers in Malaysia, Bank
Islam is adapting to these changes by accommodating the products and service
from the angles of the implications of Shariah. The fourth analysis is
focused on the technological factors. The development and introduction of
online banking and Automated Teller Machines (ATM) have provided
convenience and ease for customers, which in turn have reduced customer
service time. The fifth analysis is about the legal factors. The government
policies and legislations also directly impact the performance of Bank Islam as all
the local banks in Malaysia are regulated under the system of Bank Negara
Malaysia. As regards the last analysis, which is about the environmental
factors, it is worth-mentioning that the Bank Islam is committed to save the
environment through its various corporate social responsibility programs.

THE MISSION AND VISION

BANK MUAMALAT

Mission
“To ethically deliver best value to stakeholders, society and environment.”

Vision
“To become the preferred Islamic financial services provider.”

AFFIN BANK

Mission
To provide innovative financial solutions and services to target customers in order to
generate profits and create value for our shareholders and other stakeholders. In
doing so, we provide opportunities for employees to contribute and excel; and be
competitive in providing our solutions and services to our valued customers. We shall
conduct our business with integrity and professionalism in compliance with good
corporate governance, principles and practices.

Vision

“A Premier Partner For Financial Growth & Innovative Service”

SUSTAINABILITY MISSION STATEMENT

AFFIN BANK

The Group will work together with the Government in developing the nation and in
promoting economic growth. The Company believes that increases in business
activities within the country would have a favourable impact towards the country’s
economic stability as well as the Group’s well-being.

We will conduct our business in a socially responsible and ethical manner. We

respect the law, support human rights and protect the environment. The Group will
conduct its business with a view towards long term environmental sustainability and
preserving the eco-system and will balance the demand for innovation with the
responsibility to do no harm to the environment. The potential environmental impact
will be considered when making business decisions and when managing our
resources.

As people are assets to any organisation, the Group strives to provide a conducive
working environment for its employees and projects an image of a caring employer.
The Group will recognise and reward outstanding performance as well as provide
training and personnel development to attract and retain the most talented and
committed employees.

CORE AREAS FOR SUSTAINABILITY

1. Workplace

The Group regards its employees as a key stakeholder. An area of concentration is

the well-being of the employees and their families. We help our employees to
achieve their full potential by engaging with them openly, honestly and with respect.
We are committed to providing a workplace that protects employee safety and
promotes their health and well-being. We promote well-being of our staff through
attractive remuneration and fringe benefits and provision of training and development
and opportunities for career advancement.

2. Marketplace

The Group’s success is built upon the trust placed in ‘doing the right thing’ through
values embedded in a culture of integrity, ethical behavior, honesty and zero
tolerance of fraud for the achievement of continuous corporate governance
excellence. The promotion of the strong ethical business culture by the Group will
also help to promote healthy marketplace. For good investor relation practices, the
Group actively engages with its shareholders and investors through the media,
Annual General Meeting/Extraordinary General Meeting, meetings with
analysts/investors, corporate briefings and road shows. We will continue to practice
active communications with the investors and public through various communication
channels such as events, advertisements, media releases, public relations and our
corporate website.

3. Community

The society is where the Group draws its customer base from. The Group believes
that every organisation should return to the community what it has been able to draw
from it. The Group aspires not only to paint an image of a caring organisation but to
truly be a caring organisation. Broadly, this encompasses our efforts in socio-
economic development, healthcare, education and community activities.

It must be noted, given that the Company’s major shareholder is Lembaga Tabung
Angkatan Tentera, its sustainability initiatives are much in line with the efforts of
helping to improve the well-being of retired and serving armed forces personnel and
their families. There is no expectation of returns from these activities as such
expectation would destroy the very basis the activities are premised on.

The objective of AFFIN Holdings is to promote and assist in the education and
welfare of the members and children of the serving and retired Armed Forces
personnel who are in need.

4. Environment

We involve our employees in our efforts to improve our performance in the protection
of environment and society and to encourage them to meet high sustainability
standards.

As a responsible Group, we are committed to manage the impact of our operations

on the environment by enabling our staff and business to become more
environmentally friendly.

BANK MUAMALAT

Islamic financial institutions build excellence and sustainable with an emphasis on

entrepreneurial spirit based on the precautionary principle, the excellence of Islamic
and professional human resources and innovative investment orientation to maximize
value to all stakeholders.
2.3 SWOT ANALYSIS

BANK MUAMALAT

STRENGTHS

Bank Muamalat is the Malaysia’s second full-fledged Islamic bank. This bank barely
been in business for around five years. Bank Muamalat Malaysia Berhad benefits
from being the first. However, the bank has strong shareholders which strong
investors and some of them are Al-Bukhary Group and Khazanah Nasional. Having a
strong shareholders are good to receive support for business prospects that result
from group synergy.

WEAKNESSES

Bank Muamalat also has their own weaknesses which the bank only just hold 0.9
percent of all loans issued in Malaysian banking. The bank growth trend of analysis
shows its lending base which goes falling. Somehow, Bank Muamalat also well-
known as the most expensive operational and investment costs where the branch
network banking has a high initial setup cost. Whereby the setup cost were too high,
ongoing operational costs in terms of overhead consist of salaries and other ongoing
expenses which includes rent and utility costs also keep increase. Other than that,
the capital base of Bank Muamalat also modest. Capacity to lend is in some way
constrained with around RM300 million in paid up capital. The bank largest loan offer
is RM3.7 billion and it can only increase its credit base by RM1.43 billion based on
RM2.27 billion grass loan amounts from 2004. Moreover, the bank’s market culture
also limited. It is relies on walk-in customers at the Bank Muamalat Malaysia Berhad
branches for income os not market-oriented while other private banking are seeking
to enhance consumer convenience by utilizing alternative delivery methods yet to
begin on such initiatives.

OPPORTUNITIES
One of the opportunities for Bank Muamalat is growing popularity of Islamic banking.
Where average annual growth rate of 20% since the inception in 1983. Bank
Muamalat also attempting by government banking institution to promote the bank as
Islamic banking center. Thus, Bank Muamalat has continuous growth I the consumer
banking industry. Consumer credit demand, expected to remain the primary driver of
overall credit supply growth in the banking system. And consumer demand expect to
grow to over 60%. Bank Muamalat Banking institution also able to cross-sell non-
banking products which is the bank has formed strategic relationship with suppliers of
insurance and other non-banking goods and services that may be combined with
banking products and services. Lastly, their benefit come from the commission of
sales in such a setup.

THREATS

Bank Muamalat has intensifying competitiveness. The addition of five new

participants, particularly three Middle Eastern institutions would be heightened and
certainly compete on convenience by heavily utilizing information technology. Also,
the scarcity of skilled personnel of Bank Muamalat which the demand for employees
who are not only knowledgeable about Syariah but also about banking. The bank
require a comprehensive programme in place to attract and retain qualified
individuals.

AFFIN BANK BERHAD

STRENGTHS

AFFIN Bank caters to numerous product segments. (Affin Bank Berhad Analysis,
2014). They provide a set for retail and corporate customers of financial products and
services. Target business segment classified as major business sectors, such as
consumer banking, SME and commercial banking. In AFFIN Bank, they will continue
to target clear goals and plans as a guide, by targeting selected customer base,
understand their needs to expand the range of its innovative products to maintain a
competitive advantage, so they developed within clearly defined risk parameters
business. They also aim to expand business in country, particularly focusing on
specialized branches of Islam, to further enhance the brand value and visibility.
Meanwhile, AFFIN Bank will open up regional markets and prepare for the
establishment of international influence. (AFFIN BANK BERHAD: Annual Report,
2018).

WEAKNESSES

The basic weaknesses of Affin Bank Berhad is about the name of the bank because
Affin Bank Berhad were the most weaker brand name compared to bigger industry.
Affin Bank Berhad weak at competing identical products with other bank entities.
Furthermore, this bank has limited facilities in terms of branch opening and the
placement of ATM in strategic location. Thus, customer are more to orientation, more
on government sector rather than creating balance target market. Affin Bank also
depending on debt to financed their assets. Additionally, conservative in terms of
using its resources to gain and generate more profitable income.

OPPORTUNITIES

Affin Bank is the bank entities that rise between several branches of private banking,
especially from high earners group where they appreciate a certain privileged when
doing financial transaction. They have positive salary growth of Malaysian and the
big spending habits that they can gain advantage. Hence, the increase number of
young population as executives and technocrats that desire for banking facilities that
suits their lifestyle such as debit card and loyalty programs. Their mass home
development, particularly, luxurious homes that potential customer needs for loan
financing. Lastly, Affin Bank has new target market segment that can be venture into.

THREATS

Affin Bank has World economic volatility that may cause economic depression such
as increase in financing rates, the pluming of monetary currency, significant
withdrawal of investment and more. Intense rivalry between banking entities that may
cause burden to the bank operating cost that may contribute to industry downfall.
Moreover, cyber-crime that can inflict significant impact to the banking industry such
as fraud, identity theft and more.
2.4 INDUSTRY ANALYSIS (MICHAEL PORTER’S FIVE FORCES)

BANK MUAMALAT MALAYSIA BERHAD

1. Rivalry among Existing Competitors

Bank Muamalat was the second-mover in the Islamic banking industry in

Malaysia and yet it was not ready to face the tough times ahead. Along with
its more-profitable partner in Islamic banking, Bank Islam, Bank Muamalat
was also faced with rising competition in the form of Islamic banking
subsidiaries of commercial banks that were allowed to offer up to 49 % stake
to foreign investors. Already, three international groups had been granted
licenses by the Malaysian Government to operate Islamic banks in the
country.

2. Threat of Substitute Products and Services

Faced with a challenging environment, the Bank realizes that building up

human resource capabilities is vital to its continued growth. It especially
needs to focus on its new work culture of professionalism to meet the
requirements of the specialized functions that it wishes to take on in the
future. As the products of Islamic banks are assumed to be comparable to
those of the conventional banks, Bank Muamalat could foresee a situation
where it should be able to withstand the vagaries of competition for Islamic
banking products in future. The Bank also targeted more than RM50 million in
annual income a year from investment banking operations from 2005
onwards. It was refocusing its consumer banking operations, a division that is
now full-fledged with competitive products, including personal loans. Bank
Muamalat hoped to increase its consumer financing to RM1 billion from
RM750 million in 2003. The Bank had also signed a strategic alliance with
MNI Takaful (a local Islamic Insurance company) to enable it to sell insurance
products at all of its branches. In addition, the Bank was looking at alliances
to sell unit trusts and Islamic financial products.
3. Power of Supplier

These developments were prompting Islamic bankers to strategise how to

outperform the other. Industry consultants said things were proceeding
according to Bank Negara’s plan to make Malaysia an international centre for
Islamic finance. And by allowing foreign players into the game, Bank Negara
had created an environment where only the strongest would survive. Such
competition issues were at the fore then, partly due to the RHB group
launching its subsidiary, RHB Islamic Bank Bhd., and negotiating to sell 30%
of its stake to Saudi-based Dallah Albaraka Group in the preceding week.
And more such units were set to come online Commerce Asset-Holding Bhd.
and Hong Leong Bank Bhd. had also received approvals to set up Islamic
banking subsidiaries.

4. Power of Customer

Bank Muamalat do not have cards in their favour and the odds appear
stacked against them. The bank have been in the local market for a lot longer
than their future competitors. “They have their advantages,” noted David
Vicary of Deloitte Touche Consulting Group Sdn. Bhd. “They had been
established here for longer, they had built up their customer base and the
products to suit those local customers.

5. Threat of New Entrant

In 2004, Bank Negara issued three Islamic banking licenses to Kuwait

Finance House, Saudi Arabia’s Al Rajhi Banking & Investment House and a
consortium led by Qatar Islamic Bank. It has been reported that Kuwait
Finance will begin operations in 2005 with an initial capital of RM380 million.
Al Rajhi Banking has a paid-up capital of 2.5 billion Saudi riyals (RM2.53
billion) and is operating over 500 branches in the Kingdom. Qatar Islamic
Bank, which was incorporated in July 1982, has a market capitalisation of
USD1.8 billion (RM6.84 billion). It is not known how much capital Al Rajhi
Banking and Qatar Islamic Bank will invest in Malaysia but it is known that
Bank Negara has stipulated that they must have a minimum paid-up capital of
RM300 million. All these banks are fighting for their market share in the
 emerging Islamic banking industry, which is estimated currently to be worth
RM90 billion or 10% of total banking assets in Malaysia. The industry size is
likely to double by 2010.

AFFIN BANK BERHAD

1. Rivalry among Existing Competitors.

Large numbers of banking entities to compete with. Hence, Affin Bank has to
compete in the same market with identical products and services for similar
target customers. Affin Bank has low switching cost for customers and clients
to move on to other banking and financial organizations due to identical range
of products and nearly similar products and services features. The bank
Brand awareness is marginal as compared to as rivalry institution such as
CIMB, Maybank, RHB and more.

2. Threat of Substitute Products and Services

The advent of technological development, most importantly, internet and

phone banking has present costs threats to banking industry. Nowadays,
banking and financial transactions over the counter are been replacing by
virtual banking services.

3. Bargaining Power of Suppliers

Central Bank strict enforcement of regulations that monitor and limit the
power of banking sector movements. Apart from that, Central Bank is
responsible in determining the rates and the supply of money. Thus, banking
entities have low control over bargaining due to Central Bank dictates the
industry.

4. Bargaining Power of Customers

The bargaining powers of consumers in this particular industry are very

significant due to low switching cost and vast existence of other banking and
financial entities. Also, products and services that are been offered to the
public between institutions are identical, thus, create an advantage for
customers to demand and be selective in choosing their service providers.

5. Threat of New Entrants

 In this particular industry, the emerging of new entrants into the market is low
due to highly restricted and regulations in awarding banking license to any
party.

HOW DOES THE COMPANY BENEFIT FROM THE OPPORTUNITIES OF THE

EXTERNAL ENVIRONMENT AND AVOID THREATS.

BANK MUAMALAT

There is a clear need to take a relook at its financial & operational position to
formulate new strategies. It opted for a niche strategy of focusing on two growth
sectors of retail and consumer financing, and Islamic capital market. It aimed to build
up its portfolio in retail and consumer financing to 55 % in 2004 and 60% by 2005.
This would call for revamping of branches and its head office into specialised units
backed by a sturdy information technology infrastructure. The bank anticipated that
the change/transformation process would involve building staff competencies in the
area of processes, information technology, and sales and marketing.

AFFIN BANK BERHAD

Strengthening the franchise through new and innovative business and operating
models to drive and capture greater growth, profitability and sustainability. Affin Bank
establishing a right mix of distribution channels and service touch-points to optimise
delivery costs and effectiveness. Investing in appropriate infrastructural and human
resource capabilities to support efficiency, effectiveness and capacity building
objectives.

Strategy conducted by the chosen company

AFFIN BANK
ENGGAGING STAKEHOLDER

- On employees, they asking for a feedback, survey, intranet, intranet, team meeting ,
town hall and engagement with employee. For example, talent and sucession
planning. This when the employee finished their contract the company will give the
compensation to show appreciation on contribution in the organisation.

- On customer or focus group, they will distribute or ask for survey. For example like
customer service and complaint in ATM downtime. With this they can gain
information about the satisfaction of customer.

- On investor, in Affin Bank they will brieft on analyst and fund managers, road show
and investor engagement session. Example, Affin bank always show all the quaterly
financial result, annual report for the year, meeting with existing shareholder and
potentional investors on an adhoc basis.

SUSTAINABILITY MISSION STATEMENT

-The Group will work together with the Government in developing the nation and in
promoting economic growth. The Company believes that increases in business
activities within the country would have a favourable impact towards the country’s
economic stability as well as the Group’s well-being.We will conduct our business in
a socially responsible and ethical manner. We respect the law, support human rights
and protect the environment. The Group will conduct its business with a view towards
long term environmental sustainability and preserving the eco-system and will
balance the demand for innovation with the responsibility to do no harm to the
environment. The potential environmental impact will be considered when making
business decisions and when managing our resources.

As people are assets to any organisation, the Group strives to provide a conducive
working environment for its employees and projects an image of a caring employer.
The Group will recognise and reward outstanding performance as well as provide
training and personnel development to attract and retain the most talented and
committed employees.
CORE AREAS FOR SUSTAINABILITY

- Workplace- The Group regards its employees as a key stakeholder. An area of

concentration is the well-being of the employees and their families. We help our
employees to achieve their full potential by engaging with them openly, honestly and
with respect. We are committed to providing a workplace that protects employee
safety and promotes their health and well-being. We promote well-being of our staff
through attractive remuneration and fringe benefits and provision of training and
development and opportunities for career advancement.

- Marketplace -The Group’s success is built upon the trust placed in ‘doing the right
thing’ through values embedded in a culture of integrity, ethical behavior, honesty
and zero tolerance of fraud for the achievement of continuous corporate governance
excellence. The promotion of the strong ethical business culture by the Group will
also help to promote healthy marketplace. For good investor relation practices, the
Group actively engages with its shareholders and investors through the media,
Annual General Meeting/Extraordinary General Meeting, meetings with
analysts/investors, corporate briefings and road shows. We will continue to practice
active communications with the investors and public through various communication
channels such as events, advertisements, media releases, public relations and our
corporate website.

-Community-The society is where the Group draws its customer base from. The
Group believes that every organisation should return to the community what it has
been able to draw from it. The Group aspires not only to paint an image of a caring
organisation but to truly be a caring organisation. Broadly, this encompasses our
efforts in socio- economic development, healthcare, education and community
activities.It must be noted, given that the Company’s major shareholder is Lembaga
Tabung Angkatan Tentera, its sustainability initiatives are much in line with the efforts
of helping to improve the well-being of retired and serving armed forces personnel
and their families. There is no expectation of returns from these activities as such
expectation would destroy the very basis the activities are premised on.The objective
of AFFIN Holdings is to promote and assist in the education and welfare of the
members and children of the serving and retired Armed Forces personnel who are in
need.

MUALAMAT BANK
- ENGGAGING STAKEHOLDER

- On employee, will be prided a portal and email, employee dialogue session

with CEO, and annual engagement survey. This will make all the employee feel very
satisfied on duty from the organization. It also making the environment feel
comfortable.

-customers, introduce digital touch point, online communicate, customer

service, and call centre. This will make the customer feel secure on using the
Muamalat company. And also it will solve any problem if anything happen like
someone trying to use your number tac, there is customer service will help and guide
the protocol to freeze account or cut the transaction.

-on investor, annual report will be provided and sustainability statement,

quaterly financial will be announce and meeting session. This will make all the
investor/shareholder to feel safe in investing with them. Also it make the investor to
look forward on long term sustainability of the business. Most important all the
director feel clear on how the company business running.

DELIVERING ON OUR STRATEGY

- The Bank has stayed on track of its RISE24 strategy that revolves around seven (7)
strategic focus areas, with a total of 24 initiatives in place. Following the adverse
impacts of the pandemic however, we recalibrated the RISE24 strategy in FY2020 to
overcome the current and future challenges through initiatives that can deliver
sustainable returns. The initiatives identified, and progress made on these initiatives
are reported below:

- We aimed to identify new business areas, increase non-fund income, and expand
our coverage as a whole to target wider and better-rated customer segments.

Maintaining Business Continuity and Sustainability

The Bank’s Business Continuity Plan (“BCP”) was activated to ensure our operations
remained uninterrupted amidst the movement restrictions imposed. Measures such
as free COVID-19 screening for all employees, work from home deployment for
noncritical job functions, and the new normal of business protocols were quickly
adopted at all the Bank’s premises. We were mindful that the first course of action
was to bolster our customers’ financial resilience as this would have a cascading
effect on our own business sustainability.

CSR of the chosen company

AFFIN BANK

GrowGrove Mangrove Tree Planting Programme

-On 26 June 2022, AFFIN Group in collaboration with Universiti Teknologi MARA
organised a ‘GrowGrove’ Mangrove Tree Planting Programme at the Pusat
Pendidikan Kecil Hutan Paya Laut, Nibong Tebal, Penang.

Through the programme, the AFFIN Group together with UiTM Permatang Pauh
students, planted 400 mangrove saplings in an effort to preserve the ecosystem and
prevent coastal erosion.

The programme was also successfully attended by YBhg. Dato ’Agil Natt, Chairman
of Affin Bank Berhad, Associate Professor Ts. Dr. Basharuddin, Deputy Rector, UiTM
Permatang Pauh, Encik Illias Shafie, Chairman of the Penang Coastal Fishermen's
Welfare Association (PIFWA) and Yang Berusaha Associate Professor of Engineer
Dr. Ahmad Rashidy Razali, Deputy Director of the Penang State Department of
Environment.

Chinese New Year 2022 Charity Luncheon & Contribution in Melaka

- The Bank organised a charity visit in conjunction with the Chinese New Year
festivity and treated residents of the Centre with lunch meals. Chairman of Affin Bank
Berhad, YBhg. Dato’ Agil Natt presented the Bank's monetary contribution to the
Centre and goodie bags toward the children which are inclusive of colouring books,
colour pencils, stationery and healthy snacks.
-AFFIN ISLAMIC’s AFFIN Barakah Charity

AFFIN ISLAMIC’s AFFIN Barakah Charity Account-i offers its account holders an
easy and convenient opportunity to donate their monthly earned profit/dividend
'hibah' to charity. To date RM101,988.34 has been donated to various charity bodies
through AFFIN Barakah Charity Account-i including wheelchairs worth RM18,500
being donated to the Kuala Lumpur Hospital (“HKL”) in 2016. Other than HKL, funds
raised from AFFIN Barakah Charity Account-i were previously donated to Persatuan
Pesakit Parah Miskin Malaysia, Selangor & Federal Territory Association for Mentally
Handicapped, Rumah Kanak-Kanak Taiping, Yayasan Kanser Malaysia and
Pemulihan Dalam Komuniti (“PDK”) Kasih Autisma.

MUALAMAT BANK

Bank Muamalat Gives Donations to Maahad Tahfiz Students & the

Underprivileged at the Breaking the Fast Ceremony.

- Masjid Jamek, Kuala Lumpur, Khamis. 23 Mei 2019: Sempena bulan Ramadhan
1440 Hijrah, Bank Muamalat Malaysia Berhad (Bank Muamalat) meraikan lebih
daripada 400 tetamu pada majlis berbuka puasa yang berlangsung di Masjid Jamek
Bandaraya, Kuala Lumpur. Para tetamu terdiri daripada anak-anak Maahad Tahfiz
Al-Bayan, Maahad Tahfiz Jailani dan golongan kurang bernasib baik (gelandangan).

Turut hadir pada majlis berbuka puasa bersama anak-anak Maahad Tahfiz dan
golongan kurang bernasib baik ialah; Y.Bhg. Dato’ Hj. Mohd Redza Shah Abdul
Wahid, Ketua Pegawai Eksekutif Bank Muamalat Malaysia Berhad, Ahli Pengurusan
Kanan dan Kakitangan Bank Muamalat Malaysia Berhad.

Bank Muamalat Raya Shopping Spree with Underprivileged Children

Raya cheer by Muamalat Bank

Kuala Lumpur: To bring Raya cheer, more than 56 orphans and underprivileged
children were treated to a shopping outing by Bank Muamalat today.
The children, from two orphanages, Baitun Nurrawdhah, Setiawangsa (26 kids) and
Pertubuhan Kebajikan Nur Syaheera, Cheras (30 kids) were given RM3,000 for each
house and RM250 for each child. They went Hari Raya shopping with employees of
Bank Muamalat Malaysia Berhad and spent about two hours shopping. They also
had the opportunity to pick their own Hari Raya attire at the Lulu Hypermarket, Kuala
Lumpur.