Page 92 - EXIM-Bank_Annual-Report-2023

EXIM BANK MALAYSIA
90 A Vision to Serve Empowering Growth Management Discussion and Analysis
ANNUAL REPORT 2023
STATEMENT OF RISK MANAGEMENT

MILEStonE AnD ACHIEvEMEntS In 2023
In line with the Bank’s Corporate Strategic Plan, the Bank is strengthening sound risk management practices and promoting good
governance.
In 2023, the Risk Management Division achieved the following major milestones and implemented the following initiatives:
1. Review of Approving Authorities and Authority Limits

The Approving Authorities and Authority Limits (AA) is a compilation of authorised approving authorities, signatories and their
respective limits approving financial and non-financial transactions, as well as expenditures or activities within the Bank.

The review considers the latest organisational structure of the Bank, which prioritises operational efficiency of the Bank’s AA
and activities, as well as the associated risk factors and control measures including the recommending party and approval
authority. Additionally, the review addresses best governance practices to ensure compliance with regulatory requirements.

2. Review of Risk Management Framework
The Risk Management Framework (the Framework) is an overarching risk management document for the Bank based on its
mandated role as a government-owned Development Financial Institution (DFI) to promote reverse investment and export of
strategic sectors, such as capital goods, infrastructure projects, shipping, value-added manufactured products and to facilitate
the entry of Malaysian companies to new markets, particularly to the non-traditional markets.

The review is to include the Environmental, Social and Governance Risk and its definition.
3. Review of Risk Appetite Metrics

The Risk Appetite Policy (The Policy) governs the Bank’s approach to establishing, communicating and monitoring risk appetite
through policies, controls and mechanisms. The Policy also outlines the governance structure for overseeing the implementation
and monitoring of the Bank’s risk appetite.

The Bank’s risk appetite addresses major types of risk taking into account, both the willingness and capacity to take on risk,
while considering the long-term financial capacity and ability to meet obligations to stakeholders.
To comprehensively manage the Bank’s operating dimensions and the primary enterprise risk categories identified in the Risk
Management Framework, the Bank is further streamlining its risk appetite metrics in accordance with the Bank’s Corporate
Strategic Plan year 2023. This will allow for more granular monitoring and reporting of the risk appetite metrics.

4. Review of Policy on Shariah Risk Management
The Bank has reviewed and enhanced the Policy on Shariah Risk Management on risk appetite of Shariah Non-Compliance (SNC)
Risk to reflect granularity with emphasise on the zero-tolerance approach and update of the Bank’s roles and responsibility on
Shariah Risk Management (SRM) governance structure.
5. Review of the Bank’s Credit Related Documentations
The Bank has reviewed and enhanced its credit risk policy and procedures for effective implementation across the organisation.

The Credit Risk Policy (the Policy) is the governing Policy of the Bank’s credit management.
The Credit Processes and Procedures (the Procedures) is a procedural document for the implementation of the Credit Risk
Policy. The Procedures review is to further improve the end-to-end credit processes.