BIMB Integrated Annual Report 2017

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2017 52. COMMITMENTS AND CONTINGENCIES In the normal course of business, the Group’s banking subsidiary makes various commitments and incur certain contingent liabilities with legal recourse to their customers. No material losses are anticipated as a result of these transactions. These exclude all contracts cleared in the normal course of the takaful business. The off-balance sheet and counterparties credit risk for Bank Islam is as follows: POSITIVE FAIR VALUE OF CREDIT RISK PRINCIPAL DERIVATIVE EQUIVALENT WEIGHTED 31 DECEMBER 2017 AMOUNT CONTRACTS AMOUNT ASSET NATURE OF ITEM RM’000 RM’000 RM’000 RM’000 Credit related exposures Direct credit substitutes 2,871,511 – 2,871,511 2,167,427 Transaction related contingent items 1,066,956 – 533,478 499,771 Short term self-liquidating trade related contingencies 373,328 – 74,666 71,836 Other commitments, such as formal standby facilities and credit lines, with an original maturity of: – not exceeding one year 318 – 64 32 – exceeding one year 1,226,538 – 613,269 445,326 Unutilised credit card lines – – – – Any commitments that are unconditionally cancelled at any time by the bank without prior notice or that effectively provide for automatic cancellation due to deterioration in a borrower’s creditworthiness 4,402,695 – – – 9,941,346 – 4,092,988 3,184,392 Derivative Financial Instruments Foreign exchange related contracts – less than one year 3,218,824 63,827 112,875 41,796 Profit rate related contracts – less than one year – – – – – one year to less than five years 207,992 2,132 4,921 984 – five years and above 400,000 2,360 14,351 8,895 3,826,816 68,319 132,147 51,675 Total 13,768,162 68,319 4,225,135 3,236,067 295 Overview Value Creation Accountability Financial Statements Sustainability Performance Data Shareholders Information 21 st AGM Information Management Discussion & Analysis e