Page 74 - Bank-Muamalat-AR2020

72 BANK MUAMALAT MALAYSIA BERHAD About Us Our Leadership Our Strategy
About Us
ANNUAL REPORT FY2020

TREASURY AND

CAPITAL MARKETS

Foreign exchange was the mainstay of TCM’s fee income Anticipated Risks and Prospects
through consistent engagement with clientele despite the
pandemic. The bulk of TCM clients are from Government, For financial year 2021, TCM is optimistic that growth
while links have also been established with the automotive prospects are set to improve as fiscal support have stepped
and commodities sector through Bai Al-Sarf and Wa’d up sharply; economies have adapted to social distancing;
contracts, bringing in a total foreign exchange (“FX”) volume and the vaccination roll out is gathering momentum. From
of RM5.70 billion during the year. a negative growth of 5.60% for 2020, Malaysia is expected to
record a gross domestic product of 6.50% to 7.50% in 2021 as
Non-Ringgit depositors onshore and offshore (Labuan branch) the economy rebounds from its worst contraction since the
helped cushion the Bank’s liquidity through active FX Swap Asian Financial crisis in 1997.
markets as an alternative to meet the Bank’s overall funding.
Amidst the expected market recovery, the Division aims to
accelerate the process of building HQLA while remaining
Portfolio Size vs. Duration
vigilant against risk factors.
SIZE YEARS
9,000 6.00 Strategies Moving Forward For Treasury And Capital
7,000 5.00 Markets
4.00
5,000
3.00 Going forward, TCM aims to improve its overall process
3,000
2.00 by streamlining regulatory and compliance procedures,
1,000 1.00 improving its foreign exchange infrastructure and eco-system,
(1,000) 0.00 improving interbank funding credit facility via Sale and Buy
Back Agreement (“SBBA”) and Collateralised Commodity
FY18/19 FY2019 FY2020 Murabahah (“CCM”), and expanding its client base with a
Size (RM Million) Duration (Years) better run-off for a stable pool of depositors and by tapping
foreign exchange business.

OPR vs. MGII10Y The Division anticipates that Government securities supply
will grow as fiscal deficit is expected to widen from 5.4%
5.00%
4.50% to 6.0% for year 2021. Foreign participation on Government
4.00% securities will be closely watched by market players as a
3.50% conduit to support the economy. The result of FTSE Russel
3.00% index and Malaysia rating will be among the factors that will
2.50% influence the yield curve going forward.
2.00%
1.50%
1.00%
0.50%
0.00%
OPR MGII10Y
RM57.5

Million

Capital gain on securities for FY2020