Page 176 - Bank-Muamalat_Annual-Report-2023

BANK MUAMALAT MALAYSIA BERHAD

STATEMENT ON
RISK MANAGEMENT

The governance structure and committees responsible for effective governance and supervision over risk-related functions
is as illustrated below:

RISK GOVERNANCE STRUCTURE
BOARD OF DIRECTORS (BOD)

Establish a strong risk management and provide oversight for overall risk governance to ensure that the Bank’s strategic
objectives are supported by sound risk strategy and an effective risk management framework
BOARD RISK COMMITTEES

Board Risk & Compliance Committee (BRCC) Board Veto Committee (VETO) Shariah Committee (SC)
• Ensure effective management of risks and • Review approvals of large • Serve as advisory
enforcement of approved risk tolerances and limits. financing granted by Credit to the Board and
• Review and assess the existing risk management Committee (management level). Management team on
framework for its continued efficacy. all Shariah matters.
• Ensure robust infrastructure and systems as well as
resources are in place to monitor risk and capital
effectively.

EXECUTIVE LEVEL-RISK MANAGEMENT COMMITTEES
Executive Risk Management Committee (ERMC), Asset Liability Committee (ALCO), Credit Committee (CC),
Investment Committee (IC), Operational Risk Management Committee (ORMC), Business Continuity Management
Committee (BCMC), Enterprise Risk Management Committee (ERMCo), Asset Quality and Impairment
Committee (AQIC), Credit Risk Management Committee (CRMC), Model Validation and Acceptance Committee (MVAC)
and Collection & Recovery Task Force (CRT)
• Undertake the execution and implementation of Bank’s strategies, policies and methodologies in line with the Board’s vision.
• Identify, evaluate, measure and monitor the strategic and business plans, capital plan and risk appetite statement as per
the Board’s approval.

LINE OF DEFENCE
1 Line 2 Line 3 Line
st
nd
rd
(Business Units) (Risk Management Control & Compliance) (Internal Audit)
• Risk are directly undertaken and • Ensure independent oversight and • Provide independent
assumed in the day-to-day business management of all material risks undertaken review and assurance
activities and operations. by the Bank. on adequacy of risk
• As front-liners, responsible for • Provide specialised resources for developing management process and
carrying out the established risk frameworks, policies, methodologies and effectiveness of the first
processes for identifying, tools for risk identification, measurement and two lines of defence in
mitigating and managing risks control. fulfilling their mandates.
within their respective environment • Provide the control function, which monitors
aligned with the Bank’s strategic the risk by using various key indicators and
targets. reports, guided by established risk appetite
and tolerance limits.

174