STRATEGIC REVIEW 3 LIQUIDITY RISK 4 OPERATIONAL RISK Mitigation • Maintain a comprehensive liquidity risk policy and limits based on best practices. • Proactive monitoring, analysis and reporting to ensure the management of liquidity risk is within the approved Risk Appetite. • Liquidity risk limits are reviewed regularly to ensure effective management of this risk factor. • Proactive review of all liquidity risk parameters in line with regulatory requirements and current economic environment. • Preserve high quality liquid assets and well-diversified sources of funds as liquidity risk buffer under both business-as-usual (“BAU”) and stress conditions. • All exposures and non-compliances are promptly reported to Management & Board Committees. Definition Risk of adverse impact to the financial condition of the Group, or the soundness of the Group being adversely affected by an inability (or perceived inability) to meet its contractual obligations. Mitigation • Maintain and actively manage operational risk in line with the Group’s operational risk policy and approved Risk Appetite. • Risk & Compliance Units are established within significant activities and risk controllers are appointed in every division to enhance and ensure active monitoring of operational risks in the Group. • Proactive review of critical business operations’ resilience to risks arising from challenges posed by COVID-19 pandemic. • Operational risk is embedded as a key area in the assessment of risks within the Group’s products, services, processes, and systems. • Various ORM tools, comprising proactive and reactive tools, are applied to provide a robust and consistent approach in managing Group-wide operational risk. • All operational risk issues and incidents are reported to Management and Board Committees with detailed root cause analysis and action plan. Definition The risk of loss resulting from inadequate or failed internal processes, people and systems or from external events, which includes legal risk and Shariah Non-Compliance risk. INTEGRATED ANNUAL REPORT 202 1 Key Messages Overview Value Creation MD&A Sustainability Leadership Accountability Financial Additional Information 59
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