Page 51 - Bank-Muamalat-Annual-Report-2021

ANNUAL REPORT 2021 49
SUSTAINABILITY STATEMENT OUR GOVERNANCE OUR NUMBERS OTHER INFORMATION

Description and Impact of the risk How We Manage or Mitigate Link to Material Matter
Type of Risk
on the Bank the Risk and/or Strategy
Operational The risk of loss resulting from • Enhance monitoring of key risk indicators to better track risk • Ethics and Integrity
Risk inadequate or failed internal exposures and provide early warning signals • Economic Performance
processes, people and systems or from • Ongoing review and validation of operational risk tools, i.e. Risk • Procurement Practices
various external events. The effect may & Control Self-Assessment (RCSA), Key Risk Indicators (KRI) and • Training and Education
extend beyond financial losses and Incident Management & Data Collection (IMDC) • Customer Experience
may result in legal and reputational • Ongoing management of bank-wide operational risks and • Financial Inclusion
risk impacts. monitoring of risk ratings • Digital Banking
• Ongoing management of business continuity strategy and plan
This risk could also create an impact • Ongoing management and monitoring of outsourcing
on the Bank’s profitability and ability to arrangements and mitigation strategy
meet regulatory requirements as well • Ongoing review, enhancements and monitoring of risk appetite
as disrupt the Bank’s business. • Conduct periodic stress testing and scenario analysis
• Streamline and enhance operational risk management policies and
procedures
Shariah The risk that arises from failure to • On-going Shariah review • Ethics and Integrity
Non-Compliance comply with the Shariah rules and • Continuous monitoring & reporting of Shariah non-compliances • Economic Performance
Risk principles as determined by the • Enhance monitoring and tracking of Shariah non-compliance risk • Customer Experience
Shariah Committee (SC) of the Bank exposures via risk tools i.e. Key Risk Indicators, Risk Control • Financial Inclusion
and relevant Shariah regulatory Self-Assessment and Incident Management and Data Collection
councils or committees. • Ongoing review, enhancements and monitoring of risk appetite
• Conduct periodic stress testing and scenario analysis
This risk creates regulatory, profitability • Streamline and enhance Shariah risk management policies and
and reputation impacts. procedures
Technology and Risk arising from Technologies • Establish and operationalize new Technology Risk Management • Ethics and Integrity
cybersecurity vulnerabilities which could result Framework (TRMF) and Cyber Resilience Framework (CRF) • Economic Performance
risk in financial loss, disruptions to • Develop and implement IT & Cybersecurity Strategic Plan in • Financial Inclusion
infrastructure, operations and/or alignment with business requirements and adherence to BNM’s Risk • Customer Experience
reputational harm. Cybersecurity risk Management in Technology (RMiT) policy • Digital Banking
is the probability of loss of customer • Foresight by gathering FI threat intelligence through identifying,
information and banking records due managing and addressing relevant technological and cyber risks
to cyber threat or attack. • Strengthen cyber resilience level and monitor sustainability of
technology and cybersecurity controls
This risk creates regulatory, profitability • Ongoing review, enhancements and monitoring of risk appetite
and reputation impacts as well as
disrupt the Bank’s business.

Strategic Risk The risk of unexpected adverse • Ongoing review, enhancement and monitoring of the business • Ethics and Integrity
developments in the Bank’s strategies, risk appetite and capital planning process • Economic Performance
performance stemming from • Conduct periodic stress testing and scenario analysis • Customer Experience
fundamental strategic and business • Ongoing review, enhancements and monitoring of risk appetite and • Financial Inclusion
decisions and their execution. business performance • Digital Banking
• Perform competitive analysis on industry and market benchmark
The risk may present impacts to
the Bank’s profitability, capital and
reputation.
Reputational The risk of loss arising from negative • Ongoing monitoring of Bank’s risk rating • Ethics and Integrity
Risk perception of the Banks’s image • Build and protect goodwill • Economic Performance
by conduct or business practice • Institutionalize and monitor risk and compliance culture • Customer Experience
which adversely impact profitability, • Financial Inclusion
operations or shareholder value. • Community
Development
The Bank’s reputation, liquidity, capital • Employment
and profitability may be impacted by • Training and Education
this risk. • Diversity and Equal
Opportunity
• Procurement Practices
• Digital Banking