Page 45 - Bank-Muamalat_Annual-Report-2023
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ANNUAL REPORT 2023
OUR STRATEGY
Type of Risk Description and impact of the risk How we manage or mitigate the risk
Rate of The risk of variability of assets and • Develop hedging strategies against adverse price movements
Return Risk liabilities arising from volatility of market • Enhance monitoring in market risk limits
benchmark rates, impacting portfolios • Enhance monitoring of key risk indicators to better track risk
both in the trading and banking books. exposures and provide early warning signals
Such changes may adversely affect both • Ongoing review, enhancements and monitoring of risk appetite
earnings and economic value
• Diversification in pricing strategy
The Bank’s capital, liquidity and • Conduct periodic stress testing and scenario analysis
profitability may be impacted by the risk • Enhance risk strategies and monitoring in Asset and Liabilities
Management
• Streamline and enhance Rate of Return Risk policies
Link to Material Matter Link to Impact on Capitals
Liquidity Risk The risk of inability to fund any obligation • Enhance liquidity limits and strategy to manage and optimise
on time as they fall due, whether due to liquidity position
increase in asset or demand for funds • Enhance monitoring of key risk indicators to better track risk
from depositors. This ability has a serious exposures and provide early warning signals
implication on reputation and continued • Enhance Liquidity Contingency Funding Plan to manage liquidity
existence crisis
The risk could impact the Bank’s capital, • Ongoing monitoring of liquidity crisis early warning signals
liquidity, profitability and reputation • Ongoing review, enhancements and monitoring of
risk appetite
• Diversification in pricing strategy
• Conduct periodic stress testing and scenario analysis
• Streamline and enhance Liquidity Risk policies
Link to Material Matter Link to Impact on Capitals
Social &
Financial Capital Manufactured Capital Human Capital Intellectual Capital
Relationship Capital
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