Page 379 - Bank-Muamalat_Annual-Report-2023

ANNUAL REPORT 2023
OUR NUMBERS

BASEL II

PILLAR 3 DISCLOSURE

OVERVIEW
The Pillar 3 Disclosure is a regulatory requirement aimed at enhancing market transparency and discipline. It is prepared
in accordance to the Bank Negara Malaysia’s (“BNM’s”) guidelines “Capital Adequacy Framework for Islamic Banks (“CAFIB”) -
Disclosure Requirements (“Pillar 3”)” and contains qualitative and quantitative information on Bank Muamalat Malaysia Berhad’s
(“Bank Muamalat”) risk exposures and capital adequacy levels as well as on its capital and risk management practices.

In assessing its capital position, Bank Muamalat applies the prescribed Standardised Approach to measure its credit and
market risk exposures and the Basic Indicator Approach for operational risk, as outlined under the BNM’s CAFIB guidelines.

This Pillar 3 disclosure is published for the financial year ended 31 December 2023 and should be read in conjunction with
Bank Muamalat’s audited financial statement for the year ended 31 December 2023.

1.0 SCOPE OF APPLICATION
The Pillar 3 Disclosure is prepared on a consolidated basis and comprises information on Bank Muamalat and its
subsidiaries (hereinafter referred as “the Group and the Bank”). Information on subsidiaries is available in Note 11 to the
financial statements.
The basis of consolidation for financial accounting purposes is described in Notes 2.2 to the financial statements, and differs
from that used for regulatory capital purposes. The investment in subsidiary companies is deducted from regulatory capital at
entity level and consolidated at group level.
There are no significant restrictions or impediments on the transfer of funds or regulatory capital within the Group.

There were no capital deficiencies in any of the subsidiary companies of the Group as at the financial year end.
All information in the ensuing paragraphs is based on the Group’s position. Certain information on capital adequacy relating
to the Group and the Bank is presented on a voluntary basis to provide additional information to users. The capital-related
information of the Group and the Bank, which is presented on a global basis, includes its offshore banking activities in Labuan
as determined under the CAFIB.

This document discloses the Group’s and the Bank’s quantitative disclosures in accordance with the disclosure requirements
as outlined in the CAFIB – Disclosure Requirements (“Pillar 3”) issued by BNM.

These disclosures have been reviewed and verified by internal auditors and approved by the Board and Directors of the
Group.
Scope of disclosure

The detailed scope of published disclosure is subject to the following classification of information:
• Insignificant, i.e. its exclusion or distortion cannot influence the assessment or decision of a person using such
information to make economic decisions, or influence such an assessment or decision,
• Reserved, i.e. its public distribution might adversely influence the position of the Group and the Bank on the market
according to regulations on competition and consumer protection,

• Subject to law-protected confidentiality, such information is not published. In case of not publishing reserved
information or the one which is subject to law-protected confidentiality, the Group and the Bank disclose information
which is less detailed.

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