BIMB Integrated Annual Report 2017

With our focus on Responsible Finance we have the opportunity to redefine the scope of the Islamic financial sector by keeping in touch with global trends and sentiments of a new generation of consumers. Going forward, Bank Islam intends to develop FinTech services targeted towards the retail banking and SME segments powered by its strategic collaboration with US-based Cognizant. By partnering with Cognizant to build a digitalised banking space, Bank Islam shall jointly develop FinTech solutions, such as peer-to-peer financing, crowdfunding, mobile payments, wealth management, and remittance platforms to develop innovative products and services at competitive pricing. Through Inclusive Growth , we reinforce our commitment to TN50 aspirations by identifying largely untapped markets for the underserved and placing resources in developing new financial products and services. In 2018, this will include a focus on SMEs, towards which Bank Islam has established an SME Banking division. The Bank will soon introduce 10 newly- transformed SME Centres nationwide to assist entrepreneurs in their business financing needs. Bank Islam is also in the midst of collaborating with a higher learning institution to develop a structured training module for SMEs particularly in the areas of financial management and discipline. The cost will be borne by the Bank as part of its contribution to the VBI agenda. Through digitalisation, Bank Islam will be able to accelerate SME banking by providing business solutions for operational and expansion needs. Bank Islam will also be able to rapidly tap into the rural, underbanked segments and boost financial inclusion by overcoming cost and physical barriers. Takaful Malaysia is also making great strides in its digital journey with its recent partnership with Fusionex International, a market leader in data technology, analytics and artificial intelligence; and ReMark International, a digital marketing specialist company. The launch of its “Click for Cover” portal is just the beginning of multiple digital initiatives, including systems integration with key business partners, further online self-service options, and a mobile application, as part of a holistic digital strategy plan to attract new customer segments, and increase margins and market share. Collaboration agreements for online distribution with Lembaga Tabung Haji (“LTH”) and Bank Islam were also signed in 2018 to introduce online Takaful products to depositors of LTH and customers of the Bank. The implementation of these new delivery systems will lead to cost escalation, however in this data-driven age, we believe embracing data technology is crucial to remain relevant, competitive and scale to greater heights. Innovation needs to be at the core of businesses, as this differentiates the leaders from the followers. In Talent Enrichment , we will continue to nurture our employees as valuable assets and create a talented workforce well-versed and invested with the Group’s beliefs and principles. We intend to increase productivity of our workforce by aligning our sustainable practices with best culture practices such as the establishment of clear direction, priorities and goals. We have also invested substantially in the career development of our staff in order to create a highly professional and customer–centric organisation. Employees at different levels in the organisation are provided professional training and development programmes that commensurate with their roles and responsibilities, to further enhance their competencies, skills and ability to drive the Group towards our business goals. In addressing risk of internal talents moving to serve competitors or other corporations, the Group invests in Employee Value Proposition initiatives to help retain its talent. To date, staff retention is commendable at 97.3%. Enhancing our credibility as the leading Islamic financial institution, we are intent on committing to Ethical Practice & Reporting . Towards this end we continue to intensify efforts to inculcate a Shariah-compliant mindset and culture within BHB to enhance the manner in which management and employees interact with each other as well as with our external stakeholders. In the process, we are building important relationships based on trust and respect internally as well as externally, further enhancing our corporate reputation and brand. Last but not least, leveraging on our strength as a holding company, we will advance by creating more opportunities for our respective subsidiaries to increase their customer base by leveraging on the unique business portfolios offered within the Group. Where possible, we share resources among our operating units to enhance efficiency in delivering products and services. This increases the prospect for our respective subsidiaries to cross share knowledge and gain new perspectives, as well as innovate new possibilities in service delivery. 65 Overview Value Creation Accountability Financial Statements Sustainability Performance Data Shareholders Information 21 st AGM Information Management Discussion & Analysis l