Page 76 - Bank-Muamalat-Annual-Report-2021

74 BANK MUAMALAT MALAYSIA BERHAD
ABOUT US OUR LEADERSHIP OUR STRATEGY OUR PERFORMANCE

TREASURY AND
CAPITAL MARKETS

Performance Review

During the year under review, IB registered RM1.1 million VALUE-BASED BANKING
in fee income, comprising arranger fees, agency fees and INITIATIVE
management fees derived from Investment Banking activities.
The fee income for FYE2021 was lower as compared to FY2020
due to limited deals in the pipeline arising from the prolonged Serving the Underserved
Movement Control Order (MCO) and stiff competition with the Communities: IB is committed
large investment banks.
to value-based banking, as
On the other hand, investment income from MVSB had demonstrated by our investment
contributed substantially to IB for the year. MVSB income had
recorded an increase of 20.3% to RM9.8 million in FY2021 partnership with a state
as compared to RM8.2 million in FY2020. The increase in government-linked company which
MVSB income is attributed to a higher profit contribution
from a Musharakah investment undertaken by MVSB in an operates Ar-Rahnu branches that
Ar-Rahnu business, which benefited indirectly from the provides instant and easy cash
pandemic situation wherein people resorted to quick cash.
in rural parts of Kelantan and
The Capital Markets landscape in 2021 remained challenging
due to the COVID-19 pandemic leading to deep contractions in Sabah. The venture generates
economies. Notwithstanding all odds in particular limited new sustainable returns to the Bank
deal flows, IB managed to turn in a commendable performance
contributed significantly by the investment income from its and allows us to promote fair and
Musharakah investment. transparent products and services
IB had also successfully arranged and managed the to underserved communities.
subsequent issue of the Bank’s RM500.0 million Subordinated
Sukuk Murabahah by tapping its existing RM1.0 billion
Subordinated Sukuk Murabahah Programme, where the
issuance book managed to register a final bid-to-cover of
Moving Forward
1.40 times (pre-final price fixing) and 1.28 times (post-final
price fixing) over the issue size.
The operating landscape in 2022 is expected to remain
Apart from the said, IB had also won an award under the Best challenging as economic recovery is projected to be
Deal by Country at The Asset Triple A Islamic Finance Award gradual and uneven amid COVID-19 containment
2021 for its role as the Joint Lead Manager for Malaysia’s measures. With the uncertainties in domestic and global
landmark Sukuk deal issued by the largest local development economies, intense competition is expected due to the
financial institution, which clinched the award under the scarcity of Capital Market deals. All in all, the future calls
“Best Bank Sukuk” category. for greater prudence and vigilance in maintaining income
generation.
IB’s focus in the coming year will be on key corporate
relationships with potential issuers and other financial
institutions to establish deal flows in debt capital markets.
Opportunities to collaborate with other banks for larger
capital market deals will also be an opportune move as
these banks seek to share balance sheet exposure to
minimise risk.