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Shariah Risk Management

The Shariah risk management function is part of the Bank’s integrated risk management framework in line with the principles
outlined in the BNM’s Policy Document on Shariah Governance. The function is resided under Shariah & Operational Risk Department,
Risk Management Division. The main function of Shariah risk management is to systematically identify, measure, monitor, control
and report SNC risk exposures associated with the operations, business, affairs, and activities of the Bank. Through the continuous
monitoring of Shariah risk profiling and controls’ effectiveness, Shariah risk facilitates the efficient and effective management of SNC
risks, and endeavours towards a zero tolerance of SNC culture across the Bank.

Shariah risk management is responsible for the development, maintenance and enhancement of its own governance, policies and
procedures and its implementation, including reporting of SNC risk exposures to the SC, Management Audit, Risk and Compliance
Committee (MARCC), Board Risk Committee (BRC), and the Board.
These also include the development and implementation of measures to elevate Shariah risk awareness within the Bank, as well
as ensure the purification of the tainted income due to non-compliance with Shariah requirements, as guided by the Bank’s SC.
Mitigation must be provided to avoid the recurrence of event(s) that could potentially result in a SNC event. The Shariah risk function
also ensures that any incident of SNC is reported to BNM as outlined in BNM’s Policy Document on Operational Risk Integrated
Online Network (ORION).

Shariah Review
A dedicated Shariah review function of EXIM Bank is established under the purview of the Compliance Department which undertake
the role of conducting regular reviews to ensure EXIM Bank’s businesses, operations, affairs, and activities of Islamic Banking and
Takaful are conducted in compliance with Shariah requirements as per the BNM’s SAC and the SC’s resolution.

In line with BNM’s SGPD requirements, Shariah review comprise Shariah qualified officers to carry out Shariah review functions
in evaluating the Bank’s level of compliance to Shariah, propose remedial rectification measures to resolve non-compliance and
implement control mechanisms to avoid recurrences.

Shariah review is guided by the Bank’s Shariah Review Plan in performing regular review exercises to provide assurance to the Senior
Management, SC and Board on the state of Shariah compliance in EXIM Bank.

The Shariah Review Plan is developed mainly by the risk-based approach in evaluating the adequacy and effectiveness of the policies
and procedures emplaced in managing SNC, and is approved by relevant committees including the SC. Subsequently, the outcome of
Shariah review activities is reported periodically to the relevant internal committees including the SC.

Shariah Audit

The Shariah Audit function of EXIM Bank, which resides under the Audit & Assurance Department (AAD), bears the responsibility
to provide an independent assessment on the quality and effectiveness of the Bank’s internal control, risk management system,
governance processes, as well as the overall compliance of the Bank’s operations, business, affairs and activities pertaining to
Shariah.

Shariah Audit is guided by the annual audit plan issued by AAD. It is classified as regulatory audit and is required to be conducted
annually. The priority auditable area is given to high-risk departments, based on AAD’s risk rating.

As per SGPD requirement, a qualified Shariah auditor is responsible for conducting the Shariah audit exercise to provide assurance
on the Bank’s Shariah compliance. The Shariah audit function reports to relevant committees, mainly the SC and the Board Audit
Committee (BAC)