Bank Islam Integrated Annual Report 2020

39. FINANCIAL RISK MANAGEMENT Overview The Group’s and the Bank’s business activities involve the use of financial instruments which expose the Group and the Bank to various financial risks, namely credit risk, market risk and liquidity risk. The Group’s and the Bank’s financial risk management is guided by the Bank’s Risk Appetite Statement and Risk Management Policies/Guidelines and subject to the oversight by the Board of Directors (“Board”) via the Board Risk Committee (“BRC”). The BRC is assisted by the specific Risk Management Committees namely the Management Risk Control Committee (“MRCC”) and the Asset & Liability Management Committee (“ALCO”). (a) Financial instruments by categories The table in subsequent pages provides an analysis of financial instruments categorised as follows: • • Fair value through profit or loss (“FVTPL”) • • Financial assets at fair value through other comprehensive income (“FVOCI”) • • Other financial assets at amortised cost (“AC”) • • Financial liabilities measured at amortised cost (“FL”) Bank 31 December 2020 Carrying amount RM’000 FVTPL RM’000 FVOCI RM’000 Amortised cost RM’000 Financial assets Cash and short-term funds and deposits and placements with financial institutions 5,216,280 – – 5,216,280 Financial assets at FVTPL 1,175,440 1,175,440 – – Derivative financial assets 61,665 61,665 – – Financial assets at FVOCI 12,558,729 – 12,558,729 – Financing, advances and others 54,670,635 – – 54,670,635 Other financial assets at amortised cost* 182,041 – – 182,041 Statutory deposits with Bank Negara Malaysia 192,425 – – 192,425 74,057,215 1,237,105 12,558,729 60,261,381 Financial liabilities Deposits from customers 51,095,451 – – 51,095,451 Investment accounts of customers 12,368,897 – – 12,368,897 Derivative financial liabilities 105,872 105,872 – – Bills and acceptance payable 29,621 – – 29,621 Recourse obligations on financing sold to Cagamas 1,501,187 – – 1,501,187 Subordinated Sukuk Murabahah 1,713,164 – – 1,713,164 Other liabilities^ 1,024,855 – – 1,024,855 Lease liabilities 312,429 – – 312,429 68,151,476 105,872 – 68,045,604 Notes to the financial statements for the financial year ended 31 December 2020 266 Financ ial Statement s Accountabi l i t y Addi t ional Informat ion