2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 2.1 Basis of preparation (continued) (a) Statement of compliance (continued) (i) Moratorium repayment on financing: (continued) •• For credit card balances, the Bank offered the option to convert the balances to term financing. •• For corporate customers, the Bank granted assistance through repayment moratorium or additional working capital or rescheduling and restructuring of existing facilities. This is to enable viable corporations in preserving jobs and resuming economic activities when conditions stabilise and improve. The financial impact of the moratorium repayment is disclosed in Note 2.19. (ii) Definition of defaulted exposures under the policy documents on Capital Adequacy Framework for Islamic Banks for which assistance is granted: •• The determination of “days past due” is based on the new repayment terms of rescheduled and restructured financing. •• Individuals or SMEs are not considered to be in default based on the “unlikeliness to repay” at the time of when the assistance was granted, except for when customers are subject to bankruptcy action. •• Corporates “unlikeliness to repay” are based on holistic assessment of all relevant factors and information, not on the act of accepting assistance from the Bank. The regulatory capital treatment above shall apply to financing denominated in Malaysian Ringgit that meet the following criteria; •• The principal or profit or both, is not in arrears exceeding 90 days at the application date of assistance. •• The application is received on or before due date of the respective assistance program. The regulatory capital treatment would also be applicable to rescheduled and restructured financing that are facilitated by AKPK, the Small Debt Resolution Scheme and the Corporate Debt Restructuring Committee. (iii) Classification in the Central Credit Reference Information System (“CCRIS”) The following shall apply for Rescheduled and Restructured (“R&R”) financing with arrears not exceeding 90 days at the application date of assistance received: •• The financing need not be reported as R&R in CCRIS; and •• The financing need not be reported as credit-impaired in CCRIS Customers under URUS shall be identified as enrolled in the programme to facilitate follow up and monitoring by AKPK and the Bank in order to provide further support. The identification shall be removed once the customers exit the programme or at the earliest, six months after enrollment date. Notes to the financial statements for the financial year ended 31 December 2022 Integrated Report 2022 254
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