Affin Bank AR11 :Layout 1...EN. KAMARUL ARIFFIN MOHD JAMIL Chief Executive Officer, Affin Islamic Bank Berhad Kamarul Ariffin Mohd Jamil is the Chief Executive Officer of Affin Islamic

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AFFIN BANK BERHAD (25046-T) 13

EN. KAMARUL ARIFFIN MOHD JAMIL Chief Executive Officer, Affin Islamic BankBerhad

Kamarul Ariffin Mohd Jamil is the ChiefExecutive Officer of Affin Islamic BankBerhad (AFFIN ISLAMIC) since 2006.

He joined AFFINBANK in 2003 as Head,Corporate Strategy Division and in 2005was appointed as Head, Islamic BankingDivision.

His appointment to his current positionwas in 2006 when AFFIN ISLAMIC wasincorporated as a wholly-ownedsubsidiary of AFFINBANK.

Prior to AFFINBANK, Kamarul held variouspositions in Pengurusan DanahartaNasional Berhad, namely Head ofManaging Director's Office and SpecialAssistant to Managing Director between1999 to 2003.

Kamarul graduated from the University ofCambridge in 1992 with a Bachelor of Arts(Economics).

EN. SHARIFFUDIN MOHAMADExecutive Director, Operations

Shariffudin Mohamad is the ExecutiveDirector, Operations of AFFINBANK.

He joined AFFINBANK as the Director,Operations in August 2007 and wasappointed to his present position effective1 November 2009.

While he was the Director, Operations, hewas also the Chief Corporate Strategistand Chief Human Resource Officer.

Currently, he oversees the OperationsDivision encompassing BranchOperations, Information Technology,Property and Logistics, Strategic andSupport Services including CustomerFulfillment, Legal and CorporateCommunications.

He brings with him over two decades ofbanking experience with a well-knowninternational financial institution and itsacclaimed global outsourcing outfit.

He graduated with a Bachelor in Financeand a Master in Business Administrationfrom Southern Illinois University, UnitedStates of America.

YBHG. DATO' ZULKIFLEE ABBAS BINABDUL HAMIDManaging Director/ Chief Executive Officer

Dato’ Zulkiflee Abbas bin Abdul Hamid, 55years old, currently holds the position ofManaging Director/ Chief Executive Officerof AFFINBANK since 1 April 2009.

He joined AFFINBANK in March 2005 asDirector, Enterprise Banking and later onwas made Executive Director, Bankingbefore assuming his current position.

Dato’ Zulkiflee has been in the bankingindustry for almost 30 years. He started ina local leading bank, working his way upthrough various ranks and responsibitiesat home and abroad. He left in 2005 whilehe was the Chief Credit Officer.

Under his current portfolio, Dato’ Zulkifleealso holds directorships in Affin InvestmentBank Berhad and Affin Islamic BankBerhad

Dato’ Zulkiflee holds a Masters in BusinessAdministration from Southern IllinoisUniversity, United States of America, thesame university of which he obtained hisBachelor of Science (Marketing).

MANAGEMENT TEAMPROFILES


EN. AMIRUDIN ABDUL HALIMDirector, Business Banking

Amirudin Abdul Halim joined AFFINBANKas Director, Business Banking in July2009.

He brings with him over 20 years ofbanking experience across many fieldswithin the industry from credit control,branch operations, business andconsumer banking to corporate services.

Amirudin served in several seniorcapacities during his long-term tenure witha local leading bank and broughtrecognition to the bank in 2007 when itreceived The Asian Banker's 'Excellencein Retail Financial Services for AutomobileLending'.

He graduated with a Bachelor of Artsdegree in Finance from St. LouisUniversity, United States of America.

He has attended various programmes byStamford University, Wharton BusinessSchool, Washington University and AsianInstitute of Management, Philippines.

EN. IDRIS ABD. HAMIDDirector, Consumer Banking

Idris Abd Hamid has over 30 years ofexperience in the banking and financeindustry. His career with AFFINBANKbegan in 1994 when he was the GeneralManager for Affin Finance Berhad and hewas later made Deputy Chief ExecutiveOfficer for AFFIN-ACF Finance Berhadfrom 2000 to 2005.

Prior to joining AFFINBANK, Idris heldvarious positions at Arab-MalaysianFinance (currently known as AmBank)from 1984 to 1994 as Branch Manager,Assistant Manager Corporate Loans andHead of Consumer Loans Division. Hegraduated from the University of NorthernColorado and Southern Illinois University,USA with Masters in BusinessAdministration and Bachelor of Science inFinance respectively.

MR. TAN KOK TOONDirector, Treasury

Tan Kok Toon (KT) completed his Bachelorof Science (Hons) in Mathematics fromUniversiti Malaya in 1987.

He joined AFFINBANK as Head ofTreasury in October 2004 and isresponsible for managing all aspects ofTreasury Division across the Group whichincludes Affin Islamic Bank Berhad andAffin Investment Bank Berhad. He is thecurrent Honorary Secretary, PersatuanPasaran Kewangan Malaysia (AssociationCambiste Internationale) and theChairman to its Seminar and EducationCommittee.

Prior to AFFINBANK, KT worked in one ofthe largest banks in Malaysia. For morethan 18 years, he served in variouscapacities of Treasury operations, such asTreasury Manager with the Bank’s NewYork branch and as Treasury BusinessAdvisor to turnaround a business projectin the Philippines. KT is also the presidentof Kelab Sukan dan Rekreasi AFFINBANK.

Management Team Profiles(cont’d)


MR. EE KOK SIN Chief Financial Officer

Ee Kok Sin began his career in 1982 as aTrainee Accountant with a firm ofChartered Accountants in London. He hasextensive experience in auditing, treasuryfunctions, financial accounting, financialmanagement and information technology.

Prior to his appointment at AFFINBANK,he was the General Manager, Finance &Services of Pengurusan DanahartaNasional Berhad. He is a Fellow Memberof the Association of the CharteredCertified Accountants (FCCA) and amember of The Malaysian Institute ofCertified Public Accountants (MICPA) andMalaysian Institute of Accountants (MIA).

MR. KASINATHAN T. KASIPILLAIGroup Chief Risk Officer

Kasinathan holds a Masters in BusinessAdministration from the University of Bath,UK and is a Certified Risk Professionalawarded by Bank Administration Institute,Chicago, USA. He is also an AssociateFellow of Institute of Bankers Malaysia.This is in recognition of his pioneering workin developing the Certified CreditProfessional (CCP) certification. He continues to serve as an activemember of CCP Examination Committeeto this day. He has over 30 years of localand overseas banking experienceparticularly in the area of RiskManagement. He comes from a foreignbank background having earlier worked inthe risk function of that bank in a numberof countries including London, Singapore,Hong Kong, Mumbai and Jakarta.

PN. KHATIMAH MAHADIGroup Chief Internal Auditor

Khatimah Mahadi has 30 years ofexperience in Internal Auditing including 23years in financial services with CitibankBerhad, a development bank and afinance company. In addition, she also hada stint with a local bank, LembagaPasaran dan Perlesenan Getah andAuditing/Consulting Firm Hanafiah, Raslan& Mohamad. She was also the Director ofCompliance and Country Internal AuditHead when she was with Citibank Berhad.



YBHG. DATO' MOHAMAD ASLAM KHAN GULAM HASSANChief Recovery Specialist

Dato' Mohamad Aslam Khan holds aBachelor's Degree in BusinessAdministration with honours. He joinedAFFINBANK in 1996 as the GeneralManager of Commercial Banking Divisionand was later appointed the Head ofSpecial Asset Management. He has heldvarious positions domestically andinternationally both in the business andbusiness support divisions. Dato' Aslamhas over 35 years of banking experience.

Prior to AFFINBANK, he held variouspositions at Maybank for 21 years. His lastposition there was the General Manager ofMaybank in New York. He also had a five-year stint with the former Oriental Bank asthe General Manager, Enterprise BankingDivision.

PN. NOR ROZITA NORDINChief Human Resource Officer

Puan Nor Rozita Nordin was appointed asChief Human Resource Officer ofAFFINBANK on 1 May 2011.

Prior to that, she was the Executive Vice-President and Head of Group HumanResource at EON Bank Group (whichcomprises EON Bank Berhad, EONCapIslamic Bank Berhad and MIMBInvestment Bank Berhad).

She has more than 28 years of extensiveworking experience in Human ResourceDevelopment and Customer RelationsStrategy from various industries (Banking& Finance, Shared Services, AutomotiveRetail and Manufacturing, Insurance andHealthcare). She has served strategic rolesin the areas of Performance and HumanCapital Development, Compensation andBenefits, Manpower Planning andRecruitment, Industrial Relations,Employee Engagement, CustomerRelationship Management and Analytics,Contact Centre Management and TargetMarketing, both in national andmultinational corporations.

She holds a Master of Sciencedegree, Bachelor of Science(Education) and Bachelor of Arts(Linguistics) degrees from SouthernIllinois University at Carbondale, USA.

EN. NAZLEE KHALIFAHChief Corporate Starategist

Nazlee Khalifah was appointed to the postof Chief Corporate Strategist in April 2011.

Prior to the appointment, he served asHead, Business Strategy & Support,Business Banking since joining the Bankin February 2009. Before joiningAFFINBANK in February 2009, he wasemployed in various capacity in Maybankespecially in Planning and StrategicManagement. He holds a Bachelor ofBusiness Administration majoring inAccounting and Finance from SimonFraser University, Vancouver, Canada.




CHAIRMAN’SSTATEMENT

Dear Shareholders,

On behalf of the Board of Directors, I am pleased to present theAnnual Report and Audited Financial Statements of Affin BankBerhad (AFFINBANK) for the financial year ended 31 December 2011.

Despite the challenging market environment in 2011, I am pleased to report that we havechalked up another profitable year, with a profit before taxation and zakat attributable toshareholders that grew impressively by 17.5% to RM613.1 million from RM521.9 million.

AFFINBANK’s success can be attributed to the Bank’s transformation effort throughvarious activities such as branch expansion, relocation, product innovation, aggressivemarketing, prudent lending policies, strong risk management practice and efficientcustomer services.

During the year, we continued to grow organically in Malaysia. We embarked on a reformprogramme by relocating four branches to more vibrant commercial vicinities and opened6 new branches, which has contributed to the growth and profitability of the Bank.

We also invested on human capital i.e. training and developing of existing staff as well asnew recruitment. We introduced new products and campaigns and improved ourcustomer touchpoints to ensure excellent and efficient customer service. At the sametime, we continued to improve on our risk management practices to be abreast with theprevailing economic climate.

The Bank’s lending activities remained focused on consumer financing and small mediumenterprises. During the year the Bank’s total gross loan grew by 14.2%, with hirepurchase, home mortgage segment and SME financing contributing to the growth. Thisloan growth is equally matched with a strong growth in customer deposits. The Bankrecorded an increase of 18.0% in its customer deposit portfolio, which subsequentlyincreased the Bank’s total deposit portfolio from 19.7% in 2010 to 23.5% in 2011.

The Bank’s asset quality remained resilient and is reflected by the lower net impairedloan from 2.02% in 2010 to 1.31% in 2011.

Our strong financial performance has enabled us to recommend a final tax exemptdividend of 5 sen per share for the year under review. Together with the interimsingle-tier dividend of 7 sen paid on 28 December 2011, the total dividend payoutfor the 2011 financial year would amount to 12 sen per share or RM172.7 million.

+17.5% Profit Before Taxation & Zakat

Chairman’s Statement(cont’d)


+14.2%Loan Growth


As the Bank continues to forge ahead in our business operations and growth, we havenot forgotten our role as a corporate citizen. We continued to participate in ourstakeholders’ activities by sponsoring the annual ‘Hari Pahlawan’ and contributing to theArmed Forces for its ‘Bungkusan Hari Raya’ and its Yayasan Warisan Perajurit to fund itseducation activities for the Armed Forces personnel and children. The Bank also tookpart in a school programme called ‘Young Voices for Conservation’ with TrEES (TreatEvery Environment Special Sdn Bhd), a non-government organization. 15 primary and secondary schools within Klang Valley and Putrajaya took part in this uniqueconservation community programme with the Forestry Department of Selangor and the Selangor Water Management Agency as partners and approved by the Ministry of Education.

The Bank also continued to be the sole official Bank at the 2011 LIMA, held every twoyears in Langkawi to demonstrate its continuous commitment to its stakeholders and insupport of national interest. It also took part in The GLC Open Day which served as anavenue to educate the public on the roles and contributions of government-linkedcompanies (GLC) in the economy.

Looking ahead, the year 2012 is going to be quite challenging for the Malaysian bankingindustry. Although the prospects for the global economy in the months ahead areuncertain, we remain optimistic about economic prospects in Asia.

Building on the momentum created in 2011, the Bank’s main focus will be to furtherleverage on its strengths by cross selling and customising products in order to achievesustainable business growth. The Bank’s business is expected to remain strong despiteintense competition amid further liberalisation, consolidation and regulatory changes inyear 2012.

The Bank will also continue to seek improvements in our customer services, providequicker turnaround time via better process efficiency and actively manage our operatingcosts to maintain profitability. With our strong balance sheet and capital position, theBank is confident that we will be able to meet all the challenges and opportunities aheadin order to serve and provide continued support to our valued customers.


+18.0%Customer Deposits Growth



On behalf of the Board, I would like to thank our shareholders, customers and businesspartners for their continuing support. My appreciation goes to all staff and managementfor their dedicated services and for delivering a commendable performance for thecurrent year. Our growth over the past year is a direct result of the dedication, passionand hard work of our people – a team which is now over 3,200 strong. Finally, I wish tothank all my fellow Board Members for their wise counsel and contributions.

Jen Tan Sri Dato’ Seri Ismail bin Hj. Omar (Bersara)Chairman


PERFORMANCEREVIEW

Affin Bank Berhad (AFFINBANK) reported profit before taxation andzakat of RM613.1 million for the financial year ended 31 December2011, an increase of 17.5% from RM521.9 million in 2010.

AFFIN BANK BERHAD (25046-T) 23AFFIN BANK BERHAD (25046-T) 23

Profit after taxation and zakat increased by 15.4% to RM440.0 million for the year ended31 December 2011, compared with RM381.2 million the year before.

The stronger performance was attributable to the successfulness of its mid to long-termstrategies coming to fruition, focusing on organic growth which included marketingexpansion activities and human capital development.

Notwithstanding the intense competition in the banking industry and the difficult businessenvironment in 2011, the Bank continuously improvised on its reach and servicestowards its customers by strengthening its internal and external resources. The Bank had embarked on a reform programme by diagnosing business developmentdifficulties at existing branches and relocating 4 of them to more vibrant commercialvicinities. The relocated branches were Sandakan, Ampang New Village, Johor Bahruand Sungai Petani.

A total of 6 new branches at new growth areas were also opened to improve the Bank’spresence in the market. The new branches are located in Meru, Klang; Gemas; Jitra;Kulim; Prince Commercial Centre, Kuching and Mutiara Rini, Johor. This has ultimatelycontributed to the overall growth and profitability of the Bank which has a total of 97branches as of year-end.

The year under review also saw the launch of new products and campaigns including thesecond wave of its highly successful nationwide savings campaign dubbed ‘O.M.G It’sBack!’ that targeted new, existing conventional and Shariah compliant savings, currentand fixed deposit account holders.

The Bank also launched a new insurance product called ‘OMG Home Protector’ whichprotects the contents of the houses or homes in collaboration with AXA Affin. Similarly,the collaboration also cut across to its hire purchase division when it made public its‘Affin HP Life’, an insurance coverage that not only covers the life of the insurer but thatof the remaining outstanding balance of the loan on the insurer’s vehicle.

In addition, AFFINBANK's Islamic banking subsidiary Affin Islamic Bank Berhad hadlaunched its flexible home and business property financing campaign called 'Let's TalkMM'. The financing products offered under this campaign is based on the globallyaccepted Islamic concept of ‘diminishing partnership’ called Musharakah Mutanaqisah.

During the year, the Bank’s net interest income rose by 3.2% to RM774.8 million fromRM751.0 million recorded in 2010. Islamic banking income increased by 11.9% toRM198.9 million from RM177.8 million the year before.

-10.9%Total Impaired Loans Improved

2.85%Gross Impaired Ratio

+15.4%Profit After Taxation and Zakat


Earnings per share increased by 15.5% to 30.6 sen per share from 26.5 sen per shareduring the year under review.

During the year, the Bank’s total assets rose by RM7.1 billion to RM49.2 billion, comparedwith RM42.1 billion in 2010.

Deposits from customers increased 18.0% to RM36.5 billion from RM31.0 billionrecorded the year before. Of this total, fixed deposits remained as the biggest contributorin the year under review contributing RM22.3 billion, an increase of 11.4% from RM20.0billion in 2010.

Even with the growth in financing, the Bank’s impaired loans continued to improve. Totalimpaired loan improved 10.9% to RM865.7 million for the year under review, comparedwith RM971.1 million a year ago due to the Bank’s better credit underwriting standards,asset portfolio and risk management. Gross impaired ratio is at 2.85% as compared to3.66% in 2010.

Net loans, advances and financing increased by 14.3% to RM29.7 billion from RM26.0billion the year before, mainly contributed by household loans, followed by real estate,transport, storage and communication.

The Bank is well capitalised with its risk weighted capital ratio at 11.91% and a corecapital ratio of 9.78%.

On 19 July 2011, RAM Rating Services Berhad has reaffirmed the Bank's longterm andshort-term financial institution ratings, at A1 and P1, respectively, with a stable outlook.

Moving into 2012, the Bank will continue its broad expansion plans and marketingactivities abide the uncertainties, globally and within the country. The continued economiccrises in Europe and US will affect those in the export industry and the ripple effect willbe felt but not significantly. The Economic Transformation Programme (ETP) by theMalaysian Government will ensure the growth of the economy domestically and therewill be many opportunities for the small and medium-sized businesses (SMEs) as well as its citizens.

The Bank is confident that it will continue to register growth next year with emphasis onits fee-base income while strengthening its core business areas with more improved andinnovative products and services.


11.91%Risk Weighted Capital Ratio

9.78%Core Capital Ratio


EARNINGS PER SHARE (EPS)(Sen)

(RM’million)(RM’billion)

30.6

2011

2010

2009

2008

2007

26.5 22.1 23.0 18.0

PROFIT BEFORE TAXATION AND ZAKAT (PBT)

613.1

2011

2010

2009

2008

2007

521.9 425.1 454.6 322.0

TOTAL ASSETS

49.2

2011

2010

2009

2008

2007

42.1 35.6 33.0 31.9

NET LOANS, ADVANCES & FINANCING(RM’billion)

(RM’billion) (RM’billion)

29.7

2011

2010

2009

2008

2007

26.0 22.0 19.5 16.8

DEPOSITS FROM CUSTOMERS

36.5

2011

2010

2009

2008

2007

31.0 26.4 25.2 23.5

SHAREHOLDERS’ EQUITY

3.6

2011

2010

2009

2008

2007

3.3 3.0 2.7 2.5

AFFINBANK’s EPS for the financial year

ended 31 December 2011 stood at

30.6 sen, compared to 26.5 sen the

year before.

AFFINBANK achieved PBT of RM613.1

million, a commendable 17.5% rise for

the year ended 31 December 2011,

compared to RM521.9 million in 2010.

AFFINBANK’s PAT also rose by 15.4%

to RM440.0 million for the year ended

31 December 2011.

AFFINBANK’s financial position as at

31 December 2011 continued to

remain strong with total assets of

RM49.2 billion, an increase of 17.1%

compared with RM42.1 billion as at

31 December 2010.

AFFINBANK’s net loans, advances and

financing grew by 14.3% to RM29.7

billion compared with RM26.0 billion in

2010, as economic activities and

demand for credit gathered momentum

during the year under review.

Total deposits increased by 18.0%

year-on-year to RM36.5 billion as at

31 December 2011, in correspondence

to AFFINBANK’s loan growth.

Total shareholders’ equity of

AFFINBANK increased by 8.7% to

RM3.6 billion from RM3.3 billion the

year before.

FINANCIALHIGHLIGHTS

AFFINBANK garners a depositgrowth of RM1.2 billion for itseight months Oh My Goshh!(O.M.G) deposit savingscampaign. Grand Prize WinnerLee Guan Seong takes homeRM500,000 in cash deposit,while the second prize ofRM200,000 cash deposit goesto Chen Bee Kheng and thirdprize winner Chong Chon Yuanreceives RM100,000. 20

May

201

1

AFFINBANK hosts ‘An EveningOf Mystique Gold’ as a form ofappreciation towards its topvalued corporate and consumer clients. 31

May

201

1

30 M

ay 2

011

AFFINBANK provides strongfinancial support for Treat EveryEnvironment Special Sdn Bhd(TrEES) Young Voices ForConservation schoolprogramme and educatesstudents on financialmanagement and budgeting. Ju

ne –

Nov

embe

r 201

1

AFFINBANK synergises effortswith the Bank of East Asia(BEA) to add value tocustomers and clients.Speakers from the Bank of EastAsia and experts in the fields ofbusiness and economyprimarily from East Asia touchon topics such as Updates onthe 12th Five-year PlanConference, Tax Issues in Chinaand Matters to Observe andUnderstand When Setting UpChina Enterprises. 16

Jun

e 20

11 Affin Banking Groupparticipates in the Government-Linked Companies (GLC) OpenDay, organized by KhazanahNasional which featuredmultiple activities such asexhibitions, forums and talks. 24

-26

June

201

1

AFFINBANK continues toreward deserving young talentsthrough the AFFINBANKExamination Excellence Awardand Scholarship Programme2011 which is well into itseighth year.

CORPORATEDIARY


9 A

ugus

t 201

1

In keeping with its annualtradition, AFFINBANK holds a‘buka puasa’ feast with 108orphans and 30 new Muslimconverts from the Klang Valleyarea. 19

Aug

ust 2

011

14 &

17

Aug

ust 2

011

Affin Banking Group (ABG)celebrated Hari Raya byopening its doors to corporateclients and peer companies atits first Hari Raya Open House,held at The Royale Chulan Hotel. 8

Sep

tem

ber 2

011

Partnering with the NationalBlood Centre, AFFINBANKerstake some time out from theirbusy schedules to help a goodcause at a blood donation driveheld at Menara Affin. 24

Oct

ober

201

1

AFFINBANK sponsors LIMA asthe sole official bank todemonstrate the Bank’scommitment to its stakeholdersand to strengthen rapport withthe community within thedefense industry. 6-

10 D

ecem

ber 2

011

Antitrust training for staff isconducted over a period of twodays to educate and enlightenAFFINBANKers on the AntiTrustAct and to embrace these new laws.

AFFINBANK holds true to itstradition to contribute cash andin-kind worth RM100,000 to theArmed Forces personnelserving overseas, in the spirit ofRamadhan month.


Documents

Affin Bank AR11 :Layout 1...EN. KAMARUL ARIFFIN MOHD JAMIL Chief Executive Officer, Affin Islamic Bank Berhad Kamarul Ariffin Mohd Jamil is the Chief Executive Officer of Affin Islamic