Bank Islam Integrated Annual Report 2020

43. CAPITAL ADEQUACY (CONTINUED) The components of CET I, Tier I and Tier II capital: Group Bank 2020 RM’000 2019 RM’000 2020 RM’000 2019 RM’000 Paid-up share capital 3,306,118 3,012,368 3,306,118 3,012,368 Retained earnings 2,891,023 2,594,820 2,884,760 2,589,798 Other reserves 88,558 107,265 88,707 107,398 Less: Deferred tax assets (1,511) (33,774) – (32,268) Gain on financial instruments classified as FVOCI (103,564) (104,062) (103,564) (104,062) Regulatory reserve – (25,000) – (25,000) Investment in subsidiaries – – (15,525) (15,525) Total CET I and Tier I Capital 6,180,624 5,551,617 6,160,496 5,532,709 Sukuk Murabahah 1,700,000 1,300,000 1,700,000 1,300,000 Loss provisions ^ 472,256 436,544 472,005 436,356 Total Tier II Capital 2,172,256 1,736,544 2,172,005 1,736,356 Total Capital 8,352,880 7,288,161 8,332,501 7,269,065 ^ Impairment allowances on non-impaired financing and regulatory reserve, subject to maximum of 1.25% of total credit risk-weighted assets less credit absorbed by unrestricted investment accounts. The breakdown of risk-weighted assets in the various categories of risk-weights are as follows: Group Bank 2020 RM’000 2019 RM’000 2020 RM’000 2019 RM’000 Credit risk 46,862,577 42,551,894 46,842,825 42,536,846 Less: Credit risk absorbed by unrestricted investment accounts (9,082,114) (7,628,353) (9,082,416) (7,628,353) 37,780,463 34,923,541 37,760,409 34,908,493 Market risk 638,925 580,444 638,925 580,444 Operational risk 3,719,636 3,551,083 3,675,867 3,514,162 42,139,024 39,055,068 42,075,201 39,003,099 BANK ISLAM MALAYS IA BERHAD INTEGRATED ANNUAL REPORT 2020 307