Group Assignment Report Fin658

FACULTY OF BUSINESS AND MANAGEMENT (BA242)
FIN 658 – FINANCIAL STATEMENT ANALYSIS
GROUP ASSIGNMENT
FINANCIAL REPORT : MALAYAN BANKING BERHAD & AFFIN HOLDINGS BERHAD
GROUP : DBMF10A
PREPARED BY :
NAME STUDENT NUMBER
MUHAMMAD FAIZ FAKHRUDDIN BIN SHIHABUDDIN 2019845414
MUHAMMAD ASYWAM BIN A’SRI 2019861586
MUHAMMAD DZAHIRULHAQ BIN ZUHAIDI 2019800186
MUHAMMAD HAZIM BIN MOHD ASRI 2019620422
PREPARED FOR :
PROFESOR MADYA DR NORIZA BINTI MOHD SAAD
SUBMISSION DATE : 31 DISEMBER 2021
i
ACKNOWLEDGEMENT
To begin, I want to express my gratitude and thanks to the Almighty for blessing me during my
job and enabling us to successfully accomplish the work.
We would like to express our deepest gratitude to our instructor, Profesor Madya Dr. Noriza
Bt. Mohd Saad, for providing us with the chance to do research and for giving critical advice
throughout the process. Her vision, sincerity, and passion have made a lasting impression on
us. It was an incredible joy and honour to work and study under her leadership.
Additionally, I would want to convey my thanks to my classmates for their support and aid with
this assignment. They remained receptive and patient during the assignment preparation talk.
We would be unable to achieve this without their aid.
Additionally, we owe gratitude to my parents and extended family for their support, prayers,
concern, and sacrifices in educating and preparing me for the future. They were consistently
there to support me throughout this assignment's tough completion. It's amazing to have
people that continually encourage me throughout my studies.
ii
COVER PAGE…………………………………………………………………………………. i
ACKNOWLEDGEMENT……………………………………………………………………… ii
TABLE OF CONTENTS……………………………………………………………………… iii
DECLARATION FORM……………………………………………………………………… iv-vii
1.0 EXECUTIVE SUMMARY ................................................................................................ 1

2.0 INTRODUCTION OF THE COMPANY ............................................................................ 2
2.1 Summary Background of Malayan Banking Berhad .................................................... 2
2.2 Summary Background of Affin Holdings Berhad .......................................................... 2
2.3 Industry Analysis
2.3.1 Industry Analysis of Malayan Banking Berhad .................................................... 3-5
2.3.2 Strategy Analysis of Affin Holding Berhad .......................................................... 6-7
2.4 Strategy Analysis
2.4.1 Strategy Analysis for Malayan Banking Berhad .................................................. 8-9
2.4.2 Strategy Analysis for Affin Holding Berhad ..................................................... 10-11
3.0 FINANCIAL ANALYSIS OF MALAYAN BANKING BERHAD ...................................... 12
3.1 Comparative Analysis................................................................................................. 12
3.1.1 Statement Financial Analysis............................................................................... 12
3.1.2 Income Statement Analysis ................................................................................. 13
3.2 Common Size Analysis ......................................................................................... 14-16
3.3 Financial Ratio Analysis ........................................................................................ 17-28
3.4 Cash Flow Analysis ............................................................................................... 29-33
4.0 FINANCIAL ANALYSIS OF AFFIN HOLDINGS BERHAD ........................................... 34
4.1 Comparative Analysis................................................................................................. 34
4.1.1 Statement Financial Analysis............................................................................... 34
4.1.2 Income Statement Analysis ............................................................................ 35-38
4.2 Common Size Analysis ......................................................................................... 39-47
4.3 Financial Ratio Analysis ........................................................................................ 48-49
4.4 Cash Flow Analysis ............................................................................................... 50-62
5.0 CONCLUSION BY IDENTIFYING STRENGTH AND WEAKNESS ......................... 63-64
6.0 RECOMMENDATION ................................................................................................... 65
7.0 APPENDICES .......................................................................................................... 66-84
8.0 REFERENCES ........................................................................................................ 85-87
iii
FACULTY OF BUSINESS AND MANAGEMENT
FINAL ASSESSMENT/ TEST DECLARATION FORM
Student’s Name : MUHAMMAD FAIZ FAKHRUDDIN BIN SHIHABUDDIN
Student’s ID : 2019845414 Student’s I/C No. : 940424-14-6143
Program Code : BA242 Part : 5 Course Code : FIN 658
Course
Name : FINANCIAL STATEMENT ANALYSIS
Assignment/ Due Submission

Project No. : 1 Date : 31/12/2021 Dte : 31/12/2021
PROF. MADYA. DR. NORIZA BT. MOHD SAAD

Lecturer’s Name :
I hereby declare that the work in this final assessment/ test was carried out in accordance with the
regulations of Universiti Teknologi MARA.
I acknowledge that I have been supplied with the Academic Rules and Regulations for Universiti
Teknologi MARA’s Bachelor Degree students, regulating the conduct of my study and exams.
I hereby declare that this assignment/ project is written by me and:

i. is a result of my own work;
ii. has not been used for another assessment at another department/ university/ university college
in Malaysia or another country;
iii. does not refer to/quote works of others or own previous writings without stating it both in the text
and in the reference list;
iv. mentions explicitly all sources of information in the reference list; and
v. will go through similarity check (Turnitin).
I am aware that disciplinary action (which may include the deduction of marks in the final assessment/
test) will be taken against me if I am found to be an offender.
30/12/2021
Date Student’s Signature
/ SAT FBM Sep 2020
iv
Student’s Name : MUHAMMAD ASYWAM BIN A’SRI
Course

Project No. : 1 Date : 31/12/2021 Date : 31/12/2021

Lecturer’s Name :

30/12/2021
/ SAT FBM Sep 2020
v
Student’s Name : MUHAMMAD DZAHIRULHAQ BIN ZUHAIDI
Course


Lecturer’s Name :

30/12/2021
/ SAT FBM Sep 2020
vi
Student’s Name : MUHAMMAD HAZIM BIN MOHD ASRI
Course


Lecturer’s Name :

30/12/2021
/ SAT FBM Sep 2020
vii
1.0 EXECUTIVE SUMMARY
This report is an analysis of the financial operations and performance of the company
Malayan Banking Berhad and Affin Holdings Berhad from 2016 to 2020. This report will
evaluate the industry, strategy, comparative analysis, common size, financial ratios, and
cash flow.
These financial analysis methods are critical for determining the bank's strengths and
limitations. Liquidity is used to evaluate a bank's capacity to repay its short-term
commitments. Profitability is used to evaluate a bank's operational success in terms of
profit generation. Leverage is used to evaluate the maximum amount of debt that can be
sustained or the bank's capacity to satisfy its liabilities commitments. The asset quality of
a bank is what determines how it controls and monitors credit risk.
We will evaluate Malayan Banking Berhad and Affin Holdings Berhad’s strategy and
industry from 2016 to 2020. Additionally, after completing the comparative analysis year
by year, we will assess the analysis's strengths and weaknesses. Finally, making
recommendations to ensure the company's future success.
1
2.0 INTRODUCTION OF COMPANY
We assess the financial performance of two companies. We chose Malayan Banking
Berhad and Affin Holding Berhad as companies to compare since both of them have a
strong financial performance.
2.1 Summary Background of Malayan Banking Berhad
Maybank was founded in 1960 and is now the largest corporation on the Malaysian
Stock Exchange in terms of market capitalisation (Bursa Malaysia). It is rated #1
among Malaysian listed firms and among the top 500 companies in the Forbes Global
2000 ranking of the world's leading corporations.
The Maybank Group provides a broad range of financial products and services,
including commercial banking, investment banking, Islamic banking, offshore banking,
leasing and hire purchase, insurance, factoring, trustee services, asset management,
stockbroking, nominee services, venture capital, and Internet banking.
Maybank's objective is to humanise financial services across Asia by providing people

with access to financial services on fair terms and at a fair price, and by being a
community bank.
2.2 Summary Background of Affin Holdings Berhad

AFFIN Holdings Berhad (AHB) was formed in Malaysia on 31 May 1975 as I.M.A Sdn
Bhd. It began as a credit corporation specialising in motor vehicle hire-purchase
finance. It changed its name to AFFIN Motor and Credit Finance (Malaysia) Sdn Bhd
on 15 September 1978. It was renamed AFFIN Credit (Malaysia) Sdn Bhd on 16
January 1979 and AFFIN Holdings Sdn Bhd on 2 March 1991. On 6 May 1991, it was
turned into a public corporation and given its current name. AHB's organisational
structure has altered significantly over the previous decade as a result of a series of
mergers and acquisitions done to enhance AHB's standing as the flagship financial
services subsidiary of its primary shareholder, Lembaga Tabung Angkatan Tentera
(LTAT).
The AFFIN Group is a significant indigenous financial services corporation. The

Group's core businesses include commercial, Islamic, and investment banking, as well
as money broking, fund management, and general and life insurance underwriting.
AFFIN Holdings Berhad's largest stakeholder is Lembaga Tabung Angkatan Tentera,
the country's largest superannuation fund manager for the military services.
2
2.3 Industry Analysis
Industry analysis is a component of the economic analysis process that occurs
immediately following economic analysis. This stage is crucial, since it allows
investors and analysts to identify future investment possibilities, risks, and
rewards. Investors will assess the performance of several organisations in order
to identify which industries are the most promising. Following an industry study
using Porter's five forces model, investors may use the data as input to select
which stocks from which sectors should be included in their portfolio:
2.3.1 Industry Analysis of Malayan Banking Berhad
"Porter's five forces" is a framework for the industry analysis and business strategy
development developed by Michael E. Porter of Harvard Business School in 1979.
It uses concepts developing Industrial Organization (IO) economics to derive five
forces that determine the competitive intensity and therefore attractiveness of a
market. Three of Porter's five forces refer to competition from external sources.
The remainders are internal threats. Porter referred to these forces as the micro
environment, to contrast it with the more general term macro environment. They
consist of those forces close to a company that affect its ability to serve its
customers and make a profit. Porter's five forces include three forces from
'horizontal' competition: threat of substitute products, the threat of established 32
rivals, and the threat of new entrants; and two forces from 'vertical' competition:
the bargaining power of suppliers and the bargaining power of customers.
Threat of New Entrants

Maybank possesses a number of advantages that enable it to compete with new
entrants to the market. For example, Maybank has built a strong brand among
Malaysians over the last 50 years. It has patents and other intellectual property
rights for goods and services such as Maybank2u. In terms of cost advantage,
Maybank has already identified cost savings as a primary objective of their
strategic transformation strategy in order to preserve or create competitive
advantages over other market participants. Simultaneously, Maybank has
periodically enhanced its distribution chain from end to end procedures and
consolidated it with other Maybank goods and services. For new players seeking
to compete with Maybank, they must ensure that they have a sizable capital
requirement, which has already been a significant source of competitive
advantage for the Maybank Group.
3
Threat of Substitute Product
The price elasticity of a product is influenced by replacement items; when more
substitutes become available, demand becomes more elastic, since buyers now
have more options. A near alternative product limits an industry's capacity to boost
prices. For instance, in the case of Maybank, all of its goods and services are
relatively comparable to those supplied by other rivals, such as loans and savings.
As a result, Maybank must do extensive investigation prior to developing new
products or services, particularly in terms of charges and pricing. This is because
clients have become more price conscious in recent years and have a plethora of
options available from other banks in Malaysia.
Bargaining Power of Buyers
The influence that customers have on a manufacturing business. By and large,

when buyer power is high, the relationship between the buyer and the producing
industry resembles what economists refer to as monopsony - a market with several
providers and a single buyer. In such markets, the buyer determines the price.
Customers' negotiating power is likely to be significant in the case of Maybank,
given they have a plethora of banking service options and are also price-sensitive.
Customers may do a cost comparison amongst banks in Malaysia and pick the
bank with the lowest fees. However, there are areas of the market where clients
are unconcerned with the fees imposed and are more concerned with the level of
convenience that Maybank may provide that is superior to that of other banks.
Bargaining Power of Suppliers

This necessity results in buyer-supplier partnerships between industries and the
companies that supply the raw materials used to manufacture the goods. Suppliers
with sufficient clout can exert influence on the producing sector by selling raw
materials at a premium in order to take a portion of the industry's revenues. In the
instance of Maybank, suppliers' negotiating leverage is likely to be extremely
limited due to the fact that Maybank has provided full and end-to-end services.
Maybank is not entirely reliant on other parties. For instance, under the Strategic
Transformation Plan, Maybank will develop and supply the resources and
capabilities necessary to attain distinguishing capabilities and competitive
advantages over rivals. Additionally, Maybank serves as a one-stop financial
centre, where 35 consumers can obtain all financial services at their convenience,
without relying on third-party actors or suppliers to make it happen.
4
Threat of Established Rivals
Maybank must contend with increased competition from other banks.
Simultaneously, as a result of deregulation, Maybank now faces increased
competition from international banks such as UBS, BNP, Al-Rajhi, Standard
Chartered, and Hong Leong. According to the current situation, Maybank has
already begun establishing a strong foothold in other countries such as Singapore,
Indonesia, and others through a greater focus on core business activities and
segmentation of products and services in order to cater to increased industry
diversification.
SWOT
Analysis
Strength i. Largest bank in Malaysia in terms of number of branches.
ii. Has a customer base of more than 21 million.
iii. Has presence in 17 countries across the globe.
iv. Dividend yield is high when compared to industry and sector averages.
v. Return on Assets (ROA) and Return on Equity (ROE) are substantially
higher than the industry and sector averages.
Weakness i. Much of the banking operations are focused in and around Malaysia
and Singapore, hence limited global penetration.
ii. Much of the revenue comes from retail banking and Islamic banking,
less
revenue comes from other offerings.

Opportunity i. High opportunity to expand into countries like Laos, once the bank gets
the license to operate.

ii. High opportunity to grow in investment banking in Hong Kong.
iii. Growth in internet banking will increase the customer base.
Threats i. Changes in economic policies in South East Asian countries will affect
the bank significantly.
ii. Current macroeconomic scenario across the globe affecting the bank
5
2.3.2 Industry Analysis of Affin Holdings Berhad
Porter's model of competing forces presupposes the existence of five competitive
factors that define a business's competitive strength. Michael Porter recognised
five competitive forces: Threat of replacement products, Threat of new entrants,
Intense competition among current companies, Supplier bargaining strength, and
Buyer bargaining power. Porter's Five Factors model may be used to determine
the profitability of a target industry and the forces affecting the profitability of the
existing industry.
Threat of New Entrants

The primary reason for the industry's barrier to entrance is government regulation
and policy. However, granting exclusive rights to particular projects to existing
entrants may pose a danger to new entrants' ability to compete in this highly
competitive business. Capital requirements are frequently a significant factor in
developing a corporation with a high capacity for competitiveness in its sector.
Threat of Substitute Product

Some of the most serious risks to the banking industry's survival come not from
competing banks, but from non-financial competitors. While the sector is not
threatened by replacements in terms of deposits or withdrawals, insurance, mutual
funds, and fixed income securities are only a few of the numerous banking services
supplied by non-banking organisations.
Bargaining Power of Buyers
The individual does not pose much of threat to the banking industry, but once major
factor affecting the power of buyer is relatively high switching costs. If a person
has one bank that service their banking needs, mortgage, savings, checking, etc.
it can be a huge hassle for that person to switch to another bank. As customer’s
bargaining power is less since all banks offer essentially the same products. Due
to the status quo maintained by the industry, a buyer lost by one bank will end up
with another bank resulting in a round robin situation.
6
Bargaining Power of Suppliers
Capital is the primary resources on any bank and there are four major suppliers of
capital in the industry.
i. Customer deposits
ii. Mortgages and loans
iii. Mortgage backed securities
iv. Loans from other financial institutions
By utilizing these four major supplies, the bank can be sure that they have the
necessary resources required to service their customer’s borrowing needs while
maintaining enough capital to meet withdrawal expectations.
Intense Rivalry among Existing Players

Financial services have existed for hundreds of years, and nearly everyone who
need banking services already has them. As a result, banks must make an effort
to entice clients away from competitors. They accomplish this by providing more
affordable lending, higher interest rates, investment services, and conveniences
than their competitors. Banking rivalry is frequently a battle to see who can provide
the finest and fastest services. Given the business's nature, more consolidation in
the banking industry is more likely. Major banks prefer to buy or merge with other
institutions rather than invest in marketing and advertising.
SWOT Analysis
Strength Weakness Opportunity Threats
i. Online banking Brand i. Advertising i. Globalization i. Multinationals
ii. Wide Product line ii. Supply Chain ii. Diversification ii. Globalization
iii. Wide range Branches iii. Population iii. Change in
iv. Interactive culture iv. Financial taste
v. Strong performance Leverage iv. Substitute
Products
v. Intense
Competition
7
2.4 Strategy Analysis
We do PESTEL analyses on both corporate strategies. PESTEL stands for
Political, Economic, Social, Technology, Environment, and Legal, all of which have
an influence on the industry's microenvironment. The PESTLE analysis is largely
used to ascertain the external environmental ramifications of corporate operations.
2.4.1 Strategy Analysis for Malayan Banking Berhad

Political
Maybank is based in Malaysia, a politically stable country. The bank is a
government-linked business (GLC) that is majority owned by the country's main
fund management company and the country's Employee Provident Fund. As a
GLC, the bank benefits from government initiatives that have contributed to the
bank's current status.
Economic
Maybank benefits from the current status of the economy. The BNM's overnight
policy rate adjustment indirectly boosts the bank's liquidity, allowing it to grow its
loan portfolio and lend credit to new consumers, so expanding its customer base.
A strengthening economy generates business prospects, which increases demand
for banking products and services and provides potential for the bank to expand.
Social
Cultural norms and expectations, health awareness, population growth rate, age
distribution, career attitudes, safety-consciousness, and global warming Malaysian
society has developed into a computer-literate civilization. There is a desire for
internet banking that combines financial ease with a customer's lifestyle. Maybank
30, with its debit and credit cards and a diverse merchant network, contributes to
living convenience by facilitating cashless transactions in areas where most people
would carry plastic cards rather than cold, hard cash. Additionally, there is the
possibility of the Islamic banking system, which encourages profit sharing and has
grown in favour among Muslims and non-Muslims alike.
8
Technological
What technological advancements are occurring that may have an effect on the
bank's operations? Every two years, technology advances exponentially. What
effect will this have on the products or services? New technologies are being
invented at a breakneck pace, and the rate of change itself is accelerating.
Additionally, there are changes in the entrance barriers to certain industries and in
financial decisions such as outsourcing and insourcing. Maybank is strengthening
its competitive position by outsourcing non-core activities. The bank would be able
to focus more on what it does best and optimise its resources to maximise earnings
as a result of this strategy. Additionally, it invests in cutting-edge technology and
has been an industry leader in terms of technology utilised to give superior service
to its clients.
Ecological
This element occurs in terms of ecological and environmental concerns. Numerous
these aspects will have an economic or social component. Maybank identified an
opportunity in green banking when it responded to BNM's appeal for a special fund
dedicated to customers investing in green technologies.
Legal
What is occurring as a result of legislative reforms. This may have an effect on
employment, material access, quotas, resources, imports/exports, and taxation,
among other things. Maybank is directly impacted by the legal climate. The
government's initiative to liberalise the banking sector has created opportunities
for foreign businesses to enter the Malaysian market. As part of its expansion,
Maybank expanded beyond Malaysia's borders. New legislation, such as the Anti-
Competition Law 2010, the Whistle blower Protection Act 2010, and the Personal
Data Protection Act 2010, have a direct influence on the Bank, forcing it to alter its
processes and procedures to guarantee compliance with applicable rules.
9
2.4.2 Strategy Analysis for Affin Holding Berhad
Political
i. Political stability can influence the finance and banking industry of a nation
in terms of monetary rate, investment, loan pay-offs
ii. Rules and regulations that embodied the industry in terms of licensing,
connection with Ministry of Finance, and BNM
Economic
i. Moderation in economic growth

ii. The declining rate of inflation
iii. Expansion of private consumption and business spending
iv. Expected continuous income growth
v. Monetary Policy Committee (MPC) forecast the climbing numbers for loan
demand especially in domestic oriented industries and Economic
Transformation Programme (ETP) project related.
vi. Overnight Policy Rate (OPR) expected to remain constant at 3% untill early
2014
Social
i. The increased demand for fast banking and financing services

ii. Increased financial transaction via online with the threat of security breach
iii. The needs for younger generation for banking and financial products that
suit with their lifestyle, such as rewards and freebies.
iv. The increased rate of young couple that constitute for more demand in
loan, especially housing and car loan.
v. Individuals that are seeking for profitable investment package such as Gold
investment.
Technology
i. Internet banking
ii. Phone banking
iii. Cash Deposit Machine (CDM)
10
Environment
i. ASEAN central banks have made major headway in support of

economic integration through the ASEAN Economic Community (AEC).
The central bank has endorsed a high level framework to advance
economic and financial integration.
ii. Investment banking is anticipated to maintain strong growth of 15
percent per annum throughout 2010-2015, before moderating to 10
percent in 2016-2020.
iii. The commercial banking segment is projected to maintain an annual
growth rate of seven percent over the next 10 years.
iv. The asset and wealth management industries are expected to achieve
an average growth of 8% in 2010-2020.
Legal
i. Rules and regulations that govern banking and financial institution such
as Banking and Financial Act 1989 (BAFIA), Hire Purchase Act 1967,
Islamic Banking Act 1983.
ii. The potential evaluation of transforming the KL Regional Centre for
Arbitration centre.
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3.0 FINANCIAL ANALYSIS FOR MALAYAN BANKING BERHAD
3.1 Comparative Analysis
3.1.1 Statement Financial Analysis
As we can see in chart above, the total assets of Malayan Banking Berhad have increase from
year 2016 to 2020. From the chart at year 2020 shows that the top of the year increased the
total assets by 856.9.
On the other hand, the total liabilities also have increased in the year 2016, 2017, 2018, 2019
and 2020.
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FINANCIAL STATEMENT ANALYSIS
3.1.2 Income Statement Analysis
Percentage Percentage Percentage Percentage

2019 2018 2017 2016
Change (%) Change (%) Change (%) Change (%)
-
Operating revenue
225,249 0.84 1,839,578 7.41 1,750,911 -6.58 3,480,593 15.06
Interest income -1,368,315 -7.83 1,367,559 8.49 1,023,592 6.79 324,818 2.20
Interest expense 343,495 -3.96 -1,356,560 18.57 -172,375 2.42 -711,461 11.08
Net interest income -1,024,820 -11.64 10,999 0.13 851,217 10.72 -386,643 -4.64
Net earned insurance premiums - - - - - - - -
Dividends from subsidiaries and associates 1,254,408 52.40 473,675 24.67 -480,313 -20.01 866,424 56.48
Other operating income -222,881 -5.44 417,370 11.34 -591,191 -13.84 882,804 26.04
Net insurance benefits and claims incurred, net fee and commission expenses,
change - - - - - - - -
in expense liabilities and taxation of life and takaful fund
Net operating income 6,707 0.04 902,044 6.27 -220,287 4.66 1,362,585 10.28
Overhead expenses 785,126 -13.52 74,992 -1.28 -541,064 8.73 290,262 -5.16
Operating profit before impairment losses 791,833 8.34 977,036 11.48 -761,351 2.33 1,652,847 21.68
Allowances for impairment losses on loans, advances, financing and other debts,
net
-1,145,532 156.96 433,427 -37.26 624,630 -59.18 -1,111,153 164.20
Writeback of/(allowances for) impairment losses on financial investments net 30,471 -164.94 -20,691 -933.29 142,068 -86.79 -178,962 -457.57
(Allowances for)/writeback of impairment losses on financial investments net -9,815 -162.50 - - - - - -
Operating profit -333,043 -3.81 1,395,812 18.98 5,347 19.07 362,732 5.19
Share of profits in associates and joint ventures
- - - - - - - -
Profit before taxation and zakat
-333,043 -3.81 1,395,812 18.98 5,347 0.07 362,732 5.19
Taxation and zakat 304,532 -21.14 -210,876 17.15 -305,116 33.00 225,625 -19.62
Profit for the financial year -28,511 -0.39 1,184,936 19.35 885,167 -4.67 588,357 10.08
13
3.2 Common size Analysis of Financial Position Year Ended December (2016-2020)
2020 2019 2018 2017 2016

(%) (%) (%) (%) (%)
ASSET
Cash and short-term funds 5.57 6.82 6.58 7.90 7.86

Deposits and placements with financial institutions 1.69 1.55 2.22 1.83 1.92
Financial assets purchased under resale agreements 1.63 0.50 1.11 0.34 1.09
Financial assets designated upon initial recognition at fair value through profit or 1.72 1.83 0.00
loss
Financial investments at fair value through profit or loss 2.44 1.88 3.28 3.19 2.43
Financial investments at fair value through other comprehensive income 14.78 14.98 14.25 12.55 12.74
Financial investments at amortised cost 4.17 3.35 2.64 2.04 2.07
Loans, advances and financing 61.53 62.84 63.45 64.92 64.02
Derivative assets 1.24 0.86 0.88 1.13 1.17
Reinsurance/retakaful assets and other insurance receivables 0.51 0.47 0.51 0.56 0.61
Other assets 1.14 1.22 1.27 1.43 1.75
Investment properties 0.11 0.11 0.10 0.10 0.10
Statutory deposits with central banks 1.80 2.02 2.01 2.09 2.30
Investment in subsidiaries 0.00 0.00 0.00
Interest in associates and joint ventures 0.30 0.29 0.36 0.44 0.44
Property, plant and equipment 0.28 0.31 0.34 0.35 0.38
Right-of-use assets 0.19 0.00
Intangible assets 0.82 0.83 0.88 1.00 0.98
Deferred tax assets 0.09 0.13 0.11 0.13 0.14
Total assets 100.00 100.00 100.00 100.00 100.00
14
Liabilities
– Deposits from customers 65.26 66.01 65.60 65.97 67.50
– Investment accounts of customers* 2.49 2.92 3.21 4.29 2.49
Deposits and placements from financial institutions 5.22 5.43 5.57 4.19 5.51
Obligations on financial assets sold under repurchase agreements 1.68 1.71 0.70 0.40 0.64
Derivative liabilities 1.34 0.99 0.94 1.20 1.11
Financial liabilities at fair value through profit or loss 0.78 1.10 0.83 0.49 -
Bills and acceptances payable 0.15 0.19 0.25 0.25 0.25
Insurance/takaful contract liabilities and other insurance payables 3.70 3.33 3.28 3.25 3.37
Other liabilities 2.58 2.70 2.51 2.35 1.84
Recourse obligation on loans and financing sold to Cagamas 0.18 0.19 0.20 0.13 0.17
Provision for taxation and zakat 0.02 0.05 0.10 0.06 0.01
Deferred tax liabilities 0.11 0.06 0.10 0.11 0.11
Borrowings 4.95 3.92 4.51 4.74 4.33
Subordinated obligations 1.12 1.33 1.57 2.16 2.86
Capital securities 0.34 0.44 0.82 0.84 0.85
Equity attributable to equity holders of the Bank
Share capital 5.79 5.79 5.78 1.39 1.38
Retained profits 3.26 3.22 3.30 1.96 1.81
Reserves 0.73 0.32 0.48 2.06 1.88
Share premium 0.00 0.00 0.00 3.92 3.66
Shares held-in-trust 0.00 0.00 -0.02 -0.02 - 0.02
Non-controlling interests 0.30 0.30 0.29 0.27 0.26
Total liabilities and shareholders’ equity 100.00 100.00 100.00 100.00 100.00
15
2020 2019 2018 2017 2016

RM'000 RM'000 RM’000 RM’000 RM’000
Operating revenue 100.00 100.00 100.00 100.00 100.00
Interest income 45.62 49.01 48.39 46.89 48.80
Interest expense -22.73 -23.50 -21.74 -21.46 -21.40
Net interest income 22.89 25.51 26.65 25.43 27.40
Income from Islamic Banking Scheme operations 11.32 11.86 10.75 9.38 9.71
34.20 37.37 37.40 34.82 37.12
Net earned insurance premiums 12.79 12.54 11.52 9.95 10.35
Dividends from subsidiaries and associates 0.00 0.00 0.00
Other operating income 13.77 10.46 13.22 14.08 14.23
60.77 60.37 62.14 58.85 61.70
Net insurance benefits and claims incurred, net fee and commission expenses, change
in expense liabilities and taxation of life and takaful fund -13.95 -10.37 -11.09 -9.20 -9.33
Net operating income 46.82 50.00 51.05 49.65 52.37
Overhead expenses -21.88 -23.77 -24.92 -23.48 -25.36
Operating profit before impairment losses 24.94 26.24 26.13 26.17 27.01
Allowances for impairment losses on loans, advances, financing and other debts, net -4.33 -3.36 -4.30 -6.34 -4.15
(Allowances for)/writeback of impairment losses on financial investments,net -0.07 -0.05 -0.15 -0.41 -0.81
Operating profit 20.54 22.83 21.68 19.42 22.04
Share of profits in associates and joint ventures 0.30 0.21 0.47 0.39 0.52
Profit before taxation and zakat 20.84 23.04 22.15 19.80 22.57
Taxation and zakat -4.80 -5.38 -5.05 -4.21 -5.34
Profit for the financial year 16.04 17.66 17.11 15.59 17.23
16
3.2 Financial Ratio Analysis
 Liquidity Ratio
o Current Ratio
Current Ratio = Current Asset / Current Liabilities
2020 2019 2018 2017 2016
Current Asset 795,018,979,000.00 767,357,723,000.00 726,432,259,000.00 695,206,270,000.00 665,256,197,000.00

Current Liabilities 672,695,039,000.00 659,176,489,000.00 615,147,826,000.00 589,053,226,000.00 572,840,895,000.00
Current Ratio 1.18 1.16 1.18 1.18 1.16
Current ratio implies the financial capacity of a company to clear off the current obligations by using its current assets. Here, the
current assets include cash, stock, receivables, prepaid expenditures, marketable securities, deposits, etc. While, the current debts
include short-term loans, payroll liabilities, outstanding expenses, creditors, various other payables, etc. Any current ratio that is lower
than 1 implies a negative financial performance for that business or individual. A current ratio below one is indicative of one’s inability
to pay off the present time monetary obligations with their assets.
17
o Cash Ratio
Cash Ratio = Cash and equivalent / Current Liabilities
2020 2019 2018 2017 2016
Cash And Equivalent 46,469,074,000.00 55,025,127,000.00 50,334,290,000.00 58,140,545,000.00 55,647,407,000.00

Current Liabilities 672,695,039,000.00 659,176,489,000.00 615,147,826,000.00 589,053,226,000.00 572,840,895,000.00
Cash Ratio 0.07 0.08 0.08 0.10 0.10
Cash or equivalent ratio measures a company’s most liquid assets such as cash and cash equivalent to the entire current liability of the
concerned company. As money is the most liquid form of assets, this ratio indicates how quickly, and to what limit a company can
repay its current dues with the help of its readily available assets.
18
o Average Collection Period
Average Collection Period = Average AR / (Sales/360) 2015 AR = 548,671,178,000.00

Average Account Receivable = (End AR + Open AR) / 2
Account Receivable = Current Asset - Cash And Equivalent
2020 2019 2018 2017 2016
Average Account Receivable 730,441,250,500.00 694,215,282,500.00 656,581,847,000.00 623,337,257,500.00 579,139,984,000.00

Sales 730,441,250,500.00 694,215,282,500.00 656,581,847,000.00 623,337,257,500.00 579,139,984,000.00
Average Collection Period 360.00 360.00 360.00 360.00 360.00
The average collection period is the amount of time it takes for a business to receive payments owed by its clients in terms of accounts
receivable (AR). Companies calculate the average collection period to make sure they have enough cash on hand to meet their financial
obligations. Average collection periods are most important for companies that rely heavily on receivables for their cash flows. The
average collection period represents the average number of days between the date a credit sale is made and the date the purchaser
pays for that sale. A company's average collection period is indicative of the effectiveness of its accounts receivable management
practices. Businesses must be able to manage their average collection period in order to ensure they operate smoothly. A lower
average collection period is generally more favorable than a higher average collection period. A low average collection period indicates
the organization collects payments faster. There is a downside to this though, as it may indicate its credit terms are too strict. This may
result in the customers to seek suppliers or service providers with more lenient payment terms.
19
 Capital Structure & Solvency Ratio

o Debt Ratio
Debt Ratio = Total Debt / Total Asset
2020 2019 2018 2017 2016
Total Liabilities 750,343,791,000.00 729,254,421,000.00 690,118,161,000.00 665,481,430,000.00 644,831,046,000.00

Total Asset 834,413,015,000.00 806,991,681,000.00 765,301,766,000.00 735,956,253,000.00 708,344,503,000.00
Debt Ratio 0.90 0.90 0.90 0.90 0.91
The debt ratio is a financial ratio that measures the extent of a company’s leverage. The debt ratio is defined as the ratio of total debt
to total assets, expressed as a decimal or percentage. It can be interpreted as the proportion of a company’s assets that are financed
by debt. A ratio greater than 1 show that there is a considerable portion of debt is funded by assets. In other words, the company has
more liabilities than assets. A high ratio also indicates that a company may be putting itself at a risk of default on its loans if interest
rates were to rise suddenly. A ratio below 1 translates to the fact that a greater portion of a company's assets is funded by equity.
20
o Debt To Equity Ratio
Debt To Equity Ratio = Total Debt / Shareholder Equity
2020 2019 2018 2017 2016
Total Liabilities 750,343,791,000.00 729,254,421,000.00 690,118,161,000.00 665,481,430,000.00 644,831,046,000.00

Shareholders' Equity 84,069,224,000.00 77,737,260,000.00 75,183,605,000.00 70,474,823,000.00 63,513,457,000.00
D/E Ratio 8.93 9.38 9.18 9.44 10.15
This ratio is used to evaluate a company's financial leverage. The D/E ratio is an important metric used in corporate finance. It is a
measure of the degree to which a company is financing its operations through debt versus wholly-owned funds. More specifically, it
reflects the ability of shareholder equity to cover all outstanding debts in the event of a business downturn. Given that the debt-to-
equity ratio measures a company’s debt relative to the value of its net assets, it is most often used to gauge the extent to which a
company is taking on debt as a means of leveraging its assets. A high debt/equity ratio is often associated with high risk which may
means that a company has been aggressive in financing its growth with debt.
21
o Time Interest Earned
Time Interest Earned = EBIT / Interest Expenses
2020 2019 2018 2017 2016
Net Operating Income 24,740,880,000.00 23,661,666,000.00 23,268,356,000.00 22,173,143,000.00 21,237,921,000.00

Interest Expenses 12,013,249,000.00 11,120,765,000.00 9,909,293,000.00 9,582,029,000.00 8,678,676,000.00
Time Interest Earned Ratio 2.06 2.13 2.35 2.31 2.45
The times interest earned (TIE) ratio is a measure of a company's ability to meet its debt obligations based on its current income.
The formula for a company's TIE number is earnings before interest and taxes (EBIT) divided by the total interest payable on bonds
and other debt. The TIE ratio is an indication of a company's relative freedom from the constraints of debt. Generating enough cash
flow to continue to invest in the business is better than merely having enough money to stave off bankruptcy. This indicate that a
better TIE number means a company has enough cash after paying its debts to continue to invest in the business.
22
 Asset Utilization & Efficiency Ratio

o Cash Turnover Ratio
Cash Turnover Ratio = Sales / Average Cash & Cash Equivalent 2014 C&E = 52,852,860,000.00
Average Cash & Cash Equivalent = (End C&E + Open C&E) / 2
2020 2019 2018 2017 2016
Sales 52,844,964,000.00 47,319,853,000.00 45,580,310,000.00 44,657,902,000.00 40,556,371,000.00

Average Cash & Cash Equivalent 50,747,100,500.00 52,679,708,500.00 54,237,417,500.00 56,893,976,000.00 54,250,133,500.00
Cash Turnover Ratio 1.04 0.90 0.84 0.78 0.75
The cash turnover ratio indicates how many times a company went through its cash balance over an accounting period and the
efficiency of a company’s cash in the generation of revenue. Additionally, the cash turnover ratio is often used by accountants for
budgeting purposes. A higher cash turnover ratio is desirable, as it indicates a greater frequency of cash replenishment through
revenue. However, it is important to note that there is no one ideal cash turnover ratio number. As with other ratios, it should be
compared to competitors and industry benchmarks.
23
o Account Receivable Turnover
Account Receivable Turnover Ratio = Sales / Average Account Receivable
2020 2019 2018 2017 2016
Sales 52,844,964,000.00 47,319,853,000.00 45,580,310,000.00 44,657,902,000.00 40,556,371,000.00

Average Account Receivable 730,441,250,500.00 694,215,282,500.00 656,581,847,000.00 623,337,257,500.00 579,139,984,000.00
Account Receivable Turnover Ratio 0.07 0.07 0.07 0.07 0.07
The accounts receivable turnover ratio is an efficiency ratio and is an indicator of a company’s financial and operational performance.
A high ratio is desirable, as it indicates that the company’s collection of accounts receivable is efficient. A high accounts receivable
turnover also indicates that the company enjoys a high-quality customer base that is able to pay their debts quickly. Also, a high
ratio can suggest that the company follows a conservative credit policy. On the other hand, a low accounts receivable turnover ratio
suggests that the company’s collection process is poor. This can be due to the company extending credit terms to non-creditworthy
customers who experience financial difficulties. However, it’s useful to compare a company’s ratio to that of its competitors or similar
companies within its industry. Looking at a company’s ratio, relative to that of similar firms, will provide a more meaningful analysis of
the company’s performance rather than just an abstract calculation. For example, a company with a ratio of four, not inherently a
“high” number, will appear to be performing considerably better if the average ratio for its industry is two.
24
o Fixed Asset Turnover
Fixed Asset Turnover Ratio = Sales / Average Fixed Asset 2015 FA = 38,775,918,000.00
Average Fixed Asset = (End FA + Open FA) / 2
Fixed Asset = Total Asset - Current Asset
2020 2019 2018 2017 2016
Sales 52,844,964,000.00 47,319,853,000.00 45,580,310,000.00 44,657,902,000.00 40,556,371,000.00

Average Fixed Asset 39,513,997,000.00 39,251,732,500.00 39,809,745,000.00 41,919,144,500.00 40,932,112,000.00
Fixed Asset Turnover Ratio 1.34 1.21 1.14 1.07 0.99
Generally, a high fixed assets turnover ratio indicates better utilization of fixed assets and a low ratio means inefficient or under-
utilization of fixed assets. The usefulness of this ratio can be increased by comparing it with the ratio of other companies, industry
standards and past years.
25
 Profitability Ratio
o Gross Profit Margin
Gross Profit Margin = Gross Profit / Sales
2020 2019 2018 2017 2016
Total Operating Income 32,112,198,000.00 28,569,195,000.00 28,325,486,000.00 26,281,052,000.00 25,022,348,000.00

Sales 52,844,964,000.00 47,319,853,000.00 45,580,310,000.00 44,657,902,000.00 40,556,371,000.00
Gross Profit Margin 0.61 0.60 0.62 0.59 0.62
The gross profit ratio is important because it shows management and investors how profitable the core business activities are without
taking into consideration the indirect costs. In other words, it shows how efficiently a company can produce and sell its products. This
gives investors a key insight into how healthy the company actually is. For instance, a company with a seemingly healthy net income
on the bottom line could actually be dying. The gross profit percentage could be negative, and the net income could be coming from
other one-time operations. For example, the company could be losing money on every product they produce, but staying afloat
because of a one-time insurance payout.
26
o Operating Margin
Operating Margin = EBIT / Sales
2020 2019 2018 2017 2016
Net Operating Income 24,740,880,000.00 23,661,666,000.00 23,268,356,000.00 22,173,143,000.00 21,237,921,000.00

Sales 52,844,964,000.00 47,319,853,000.00 45,580,310,000.00 44,657,902,000.00 40,556,371,000.00
Operating Margin 0.47 0.50 0.51 0.50 0.52
The operating profit margin ratio is a key indicator for investors and creditors to see how businesses are supporting their operations.
If companies can make enough money from their operations to support the business, the company is usually considered more stable.
On the other hand, if a company requires both operating and non-operating income to cover the operation expenses, it shows that the
business’ operating activities are not sustainable. A higher operating margin is more favorable compared with a lower ratio because
this shows that the company is making enough money from its ongoing operations to pay for its variable costs as well as its fixed costs.
27
o Net Profit Margin
Net Profit Margin = Net Income / Sales
2020 2019 2018 2017 2016
Profit For The Financial Year 8,475,649,000.00 8,355,936,000.00 7,796,874,000.00 6,963,892,000.00 6,986,388,000.00
Sales 52,844,964,000.00 47,319,853,000.00 45,580,310,000.00 44,657,902,000.00 40,556,371,000.00
Net Profit Margin 0.16 0.18 0.17 0.16 0.17
Net profit margin is one of the most important indicators of a company's financial health. By tracking increases and decreases in its
net profit margin, a company can assess whether current practices are working and forecast profits based on revenues. Because
companies express net profit margin as a percentage rather than a dollar amount, it is possible to compare the profitability of two or
more businesses regardless of size. Net profit margin is the percentage of profit generated from revenue after accounting for all
expenses, costs, and cash flow items.
28
3.4 Cash Flow Analysis
2020 2019 2018 2017 2016

Profit before taxation 1,604,000 1,766,000 1,711,000 1,559,000 1,723,000
Adjustments for:
Allowance for impairment on loans and financing -433000 -336000 -430000 -634000 -415000
Allowance for credit losses on other financial assets -7000 -5000 -15000 -41000 -81000
Property, Plant and Equipment:
Depreciation 91,556 84,729 85,145 77,213 76,539
Gain on disposal -71 -18 -697 -6,616 -4,520
Written off 10 114 8,664 493 6
Intangible Assets:
Amortization 81,998 62,664 51,180 47,645 39,763
Written off 0 239 0 121 0
Net Allowance (write back)/made on financial assets at
FVOCI and Financial investment at amortised cost/financial
investment AFS and HTM -14,487 214,219 249,259 -42 -118,990
Net Gain arising from disposal/redemption of financial assets
at FVTPL, financial assets at FVOCI and financial investment
at amortized cost/financial investments AFS and HTM -83,309 -36,255 -79,058 0 0
Net gain on fair value hedges -56 -115 16 -41 -205
29
Net unrealized gain on revaluation of financial assets at

FVTPL and derivatives -31,670 -25,783 -1,491 0 0
Net unrealized foreign exchange loss/(gain) 79,558 -83,001 -415,474 -328,808 -41,121
Dividend income form financial assets at FVOCI/financial
investment AFS -2,656 -6,515 -5,481 -4,489 -4,444
Dividend income from subsidiaries -9,259 -97,075 -109,469 0 -10,646
Amortization of premium/(accretion of discount) for
borrowing , subordinated obligations on Hybrid Tier- Capital
Securities 2,461 2,221 -3,749 341 315
Interest expenses on borrowing, senior debt securities, Hybrid
Tier-1 Capital Securities and subordinated obligations 292,520 377,418 0 0 0
Interest Income from financial assets at FVTPL, financial
Assets at FVOCI and financial investment at amortized
cost/financial Investment AFS and HTM -1,410,046 -1,325,812 -1,289,256 -536,571 -425,719
Write-back of allowance for impairment losses 0 0 0 -9,593 -6,001
Write-back of allowance for impairment losses 0 0 0 0 -47
Gain on disposal 0 0 0 -161 0
Net gain on sale 0 0 0 -57,351 -17,964
Net gain on early redemption 0 0 0 -228 -12,508
Interest Income 0 0 0 -651,213 -706,746
Allowance for impairment losses 0 0 0 0 233
30
Amortization / Accretion of discounts for borrowing and

subordinated obligations 0 0 0 1,028 602
Unrealized loss on revaluation of derivatives 0 0 0 331,860 100,099
Operating profit before working capital changes 1,410,046 600,060 730,255 911,371 1,450,661
Increase/(Decrease) in operating assets:
Securities purchased under resale agreements 0 1,257,914 -1,121,097 202,885 -132,170
Deposits and placements with banks and other financial
institutions 284,460 -1,636,510 142,239 -2,037,615 -2,679,866
Financial assets FVTPL -75,256 313,702 -498,252 1,159,523 -107,996
Loans, advances and financing -287,358 1,586,098 -1,307,344 -1,245,528 -14,623,190
Other Assets 605,011 2,362,562 -1,630,551 -1,079,557 -459,529
Statutory deposits -440,431 286,669 894,345 357,874 -940,425
86,426 4,170,435 -3,520,660 -2,642,418 -18,943,176
Increase/(Decrease) in operating liabilities:
Deposits from customers 6,376,021 -6,377,437 4,122,333 -4,072,232 15,800,805
Deposits and placements of banks and other financial
institutions -5,024,427 -143,922 3,288,763 2,712,784 5,584,939
Obligation on securities sold under repurchase agreements 1,532,470 -1,127,084 -2,018,989 4,246,139 321,054
Bills and acceptances payable -39,281 1,345 -197,058 11,015 -1,594,148
Other liabilities -924,525 -1,154,750 1,279,711 -22,763 1,206,639
Recourse obligation on loans sold to Cagamas 1,266,271 -1,009,205 593,915 907,335 281,011
3,186,529 -9,811,053 7,068,675 3,782,278 21,600,300
31
Cash (used in)/generated from operations 4,947,979 -4,109,924 4,278,270 2,051,231 4,107,785
Interest Paid -282,453 -390,164 0 0 0
Net tax paid -581,093 -273,408 -399,948 -555,072 -543,529
Net Cash (used in)/generated from operating activities 4,084,433 -4,773,496 3,878,322 1,496,159 3,564,256
Cash flows from investing activities
Net Proceed from disposal/(purchase) of financial investment
AFS and HTM -2,861,030 2,484,657 -1,579,818 -5,172,433 -680,826
Property, Plant and Equipment:
Purchase -93,302 -80,881 -86,529 -58,534 -73,227
Proceeds from disposal 99 104 4,573 8,673 9,788
Intangible Assets:
Purchase -189,577 -148,414 -125,183 -122,986 -93,917
Interest received from financial investments AFS and HTM 1,340,677 1,307,474 1,265,194 1,198,080 1,146,822
Dividend income received from financial investment AFS 2,656 6,515 5,481 4,489 4,444
Dividend income received from subsidiaries 97,959 2,375 109,469 0 10,646
capital reduction in subsidiaries 0 862,523 0 0 0
Additional Investment in subsidiaries -415,823 -17,701 -100,000 -54,375 -124,200
Net Cash outflow arising from internal reorganization 0 0 -3,614,753 0 0
Net Cash generated from/(used in) investing activities -2,118,341 4,416,652 -4,121,566 -4,197,086 199,530
Cash flow from Financing activities
Drawdown of borrowings & Repayment of borrowings -10,845 329,788 113,093 -533,416 69,759
Proceeds from issuance of subordinated notes 0 750,000 0 0 1,000,000
32
FINANCIAL STATEMENT
ANALYSIS
Redemption of subordinated notes 0 -2,750,000 -250,000 -200,000 0

(Redemption)/Proceeds from issuance of senior debt securities 0 -2,173,766 2,242,600 0 1,048,950
Dividends paid to equity holders of the bank -701,758 -481,205 -200,502 -145,818 0
Net Cash (used in)/generated from financing activities -712,603 -4,325,183 4,395,192 -879,234 2,118,709
Net (decrease)/increase in cash and cash equivalents 1,253,489 -4,682,027 4,151,948 -3,580,161 5,882,495
Effects of exchange rate differences 31,630 -133,580 64,639 300,711 35,365
Cash and cash equivalents:
at the beginning of the financial year 7,570,207 12,430,270 8,213,683 11,493,133 5,575,273
at the end of the financial year 8,855,326 7,614,663 12,430,270 8,213,683 11,493,133
Cash and cash equivalents comprise the following:
Cash and Short-term funds 8,855,326 7,614,663 12,430,270 8,213,683 11,493,133
Net Cash flow from Operating 4,084,433 -4,773,496 3,878,322 1,496,159 3,564,256
Net Cash Flow from Investing -2,118,341 4,416,652 -4,121,566 -4,197,086 199,530
Net Cash Flow from Financing -712,603 -4,325,183 4,395,192 -879,234 2,118,709
Net increase / decrease in cash & cash equivalent 1,253,489 -4,682,027 4,151,948 -3,580,161 5,882,495
33
4.0 FINANCIAL ANALYSIS OF AFFIN HOLDINGS BERHAD
4.1 Comparative Analysis
4.1.1 Statement Financial Analysis
As we can see in chart above, the total assets of Affin Holdings Berhad have increased from 2016 to
2018 by 68.9 billion to 76.0 billion. Then, from 2018 to 2019 the assets decreased from 76.0 billion into
68.3 billion. Lastly, the assets increase into 69.5 billion at 2020. From the chart shows that the top of
the assets at 2018 by 76.0 billion.
On the other hand, the total liabilities also increased from 2016 to 2018 by 43.7 billion into 48.4 billion.
Then, 2018 to 2019 the liabilities decreased by 48.4 billion into 45.4 billion. Lastly, the liabilities shows
that at 2020 increased to 45.5 billion. From the chart of the liabilities shows that the top of the liabilities
at 2018 by 48.4.
34
4.1.2 Income Statement
Year 2016 to Year 2017
INCREASE/
2017 2016 PERCENTAGE
DECREASE
RM'000 RM'000 (%)
RM'000
Interest income 2,367,624 2,327,761 39,863 1.71
Interest expense -1,512,371 -1,495,679 -16,692 1.12
Net interest income 855,253 832,082 23,171 2.78
Income from Islamic
334,267 272,806 61,461 22.53
banking business
Other operating income 370,935 219,542 151,393 68.96
Net income 1,560,455 1,324,430 236,025 17.82
Other operating expenses -934,289 -694,116 -240,173 34.60
Operating profit before
626,166 630,314 -4,148 -0.66
allowance
Allowances for impairment
losses on loans, advances -71,619 -23,701 -47,918 202.18
and financing and trade
receivables
-1,287 -3,855 2,568 -66.61
losses on securities
Allowances for Impairment
-12,260 0 -12,260 0.00
losses on others
Operating profit 541,000 602,758 -61,758 -10.25
Share of results of joint
-4,070 0 -4,070 0.00
ventures
Share of results of 17,140 0 17,140 0.00
associates
Profit before taxation and

554,070 602,758 -48,688 -8.08
Zakat
Zakat -3,371 -2,887 -484 16.76
Profit before taxation 550,699 599,871 -49,172 -8.20
Taxation -126,261 -135,740 9,479 -6.98
Net profit after zakat and
424,438 464,131 -39,693 -8.55
taxation
35
INCREASE/
DECREASE
RM'000 RM'000 (%)
RM'000
Interest income 2,419,367 2,367,624 51,743 2.19
Interest expense -1,573,967 -1,512,371 -61,596 4.07
Income from Islamic
398,190 334,267 63,923 19.12
banking business
Net income 1,920,602 1,560,455 360,147 23.08
Other operating expenses -1,217,509 -934,289 -283,220 30.31
703,093 626,166 76,927 12.29
allowance
losses on loans, advances -58,668 -71,619 12,951 -18.08
receivables
0 -1,287 1,287 -100.00
losses on securities
-12,243 -12,260 17 -0.14
losses on others
Operating profit 632,182 541,000 91,182 16.85
Share of results of joint -3,098 -4,070 972 -23.88
venture
Share of results of 50,025 17,140 32,885 191.86
associates
679,109 554,070 125,039 22.57
zakat
Zakat -4,113 -3,371 -742 22.01
Profit before taxation 674,996 550,699 124,297 22.57
Taxation -147,576 -126,261 -21,315 16.88

527,420 424,438 102,982 24.26
taxation
36
INCREASE/
DECREASE
RM'000 RM'000 (%)
RM'000
Interest income 2,231,836 2,419,367 -187,531 -7.75
Interest expense -1,488,719 -1,573,967 85,248 -5.42
Net interest income 743,117 845,400 -102,283 -12.10
Income from Islamic
410,683 398,190 12,493 3.14
banking business
Net income 1,931,750 1,920,602 11,148 0.58
Other operating expenses -1,223,933 -1,217,509 -6,424 0.53
707,817 703,093 4,724 0.67
allowance
losses on loans, advances -49,859 -58,668 8,809 -15.01
receivables
-5,617 -12,243 6,626 -54.12
losses on others
Operating profit 652,341 632,182 20,159 3.19

-3,860 -3,098 -762 24.60
ventures
Share of results of 34,020 50,025 -16,005 -31.99
associates
682,501 679,109 3,392 0.50
zakat
Zakat -5,530 -4,113 -1,417 34.45
Profit before taxation 676,971 674,996 1,975 0.29
Taxation -160,880 -147,576 -13,304 9.02

516,091 527,420 -11,329 -2.15
taxation
37
INCREASE/
DECREASE
RM'000 RM'000 (%)
RM'000
Interest income 1,806,750 2,231,836 -425,086 -19.05
Interest expense -1,034,607 -1,488,719 454,112 -30.50
Modification loss -78,447 0 -78,447 0.00
Income from Islamic
481,228 410,683 70,545 17.18
banking business
Other operating income 1,089,975 777,950 312,025 40.11
Net income 2,264,899 1,931,750 333,149 17.25
Other operating expenses -1,350,985 -1,223,933 -127,052 10.38
913,914 707,817 206,097 29.12
allowance
Allowances for -543,126 -49,859 -493,267 989.32
impairment losses on
loans, advancesand
financing and trade
receivables
-18,472 -5,617 -12,855 228.86
losses on others
Operating profit 352,316 652,341 -300,025 -45.99
-394 -3,860 3,466 -89.79
ventures
Share of results of 42,258 34,020 8,238 24.22
associates
394,180 682,501 -288,321 -42.24
zakat
Zakat -7,469 -5,530 -1,939 35.06
Profit before taxation 386,711 676,971 -290,260 -42.88
Taxation -113,863 -160,880 47,017 -29.22
272,848 516,091 -243,243 -47.13
taxation
38
4.2.Common Size Analysis of Financial for the Year Ended December (2016-2020)
AFFIN HOLDINGS BERHAD

Condensed Interim Financial Statements
Statements of Financial Position As At 31 December 2016
< ----------- GROUP ----------- > < -------- COMPANY --------- >
31/12/2016 31/12/2015 31/12/2016 31/12/2015
Note RM'000 RM'000 RM'000 RM'000
ASSETS
Cash and short-term funds 4,836,222 4,441,700 32,176 45,393
Deposits and placements with banks and other
financial institutions 172,871 497,161 - -
Trade receivables A9 529,728 551,579 - -
Financial assets held-for-trading A10 270,354 122,016 - -
Financial investments available-for-sale A10 14,108,523 13,085,556 - -
Financial investments held-to-maturity A10 407,087 459,368 - -
Derivative financial assets 289,271 293,864 - -
Loans, advances and financing A11 43,747,427 43,345,290 - -
Other assets A12 216,012 237,726 299 305
Statutory deposits with Bank Negara Malaysia 1,659,740 1,782,450 - -
Amount due from subsidiaries - - 1,304,592 1,004,446
Amount due from associates 45,096 58,560 45,096 58,560
Investment in subsidiaries - - 5,461,063 5,461,063
Investment in joint ventures 153,768 129,396 187,680 159,630
Investment in associates 339,887 269,774 35,242 15,623
Tax recoverable 46,838 75,994 2,515 2,459
Deferred tax assets 19,723 16,339 - -
Property and equipment 437,301 434,639 87 128
Intangible assets 1,606,497 1,612,462 2 3
TOTAL ASSETS 68,886,345 67,413,874 7,068,752 6,747,610
LIABILITIES AND EQUITY

Deposits from customers B7 51,505,642 50,548,747 - -
Deposits and placements of banks and other
financial institutions B7 3,894,037 3,385,439 - -
Obligation on securities sold under repurchase agreements 1,145,618 1,740,946 - -
Bills and acceptances payable 37,726 77,114 - -
Trade payables 724,554 642,483 - -
Derivative financial liabilities 552,942 555,867 - -
Recourse obligation on loans sold to Cagamas Berhad - 134,585 - -
Other liabilities A13 656,242 652,293 4,258 3,098
Provision for taxation 2,440 11,799 - -
Deferred tax liabilities 29,542 31,505 7 27
Amount due to subsidiaries - - 400,254 400,253
Borrowings B7 1,606,597 1,306,011 1,606,597 1,306,011
TOTAL LIABILITIES 60,155,340 59,086,789 2,011,116 1,709,389
39
< ----------- GROUP ----------- > < -------- COMPANY --------- >
31/12/2016 31/12/2015 31/12/2016 31/12/2015
Note RM'000 RM'000 RM'000 RM'000
EQUITY
Share capital 1,942,949 1,942,949 1,942,949 1,942,949
Reserves:-
Share premium 2,185,712 2,185,712 2,185,712 2,185,712
Statutory reserves 1,806,731 1,626,175 - -
AFS revaluation reserves 56,318 64,833 - -
Regulatory reserves 289,871 284,141 - -
Retained profits 2,400,913 2,178,629 928,975 909,560
Equity attributable to equity holders of the Company 8,682,494 8,282,439 5,057,636 5,038,221
Non-controlling interest 48,511 44,646 - -
TOTAL EQUITY 8,731,005 8,327,085 5,057,636 5,038,221
TOTAL LIABILITIES AND EQUITY 68,886,345 67,413,874 7,068,752 6,747,610
COMMITMENTS AND CONTINGENCIES 26,952,318 27,995,755 - -
NET ASSETS PER SHARE (RM) 4.47 4.26
40
AFFIN BANK BERHAD
< ---------- GROUP---------- > < --------- BANK ---------- >

31/12/2017 31/12/2016 31/12/2017 31/12/2016
Note RM'000 RM'000 RM'000 RM'000
ASSETS
Cash and short-term funds 4,146,815 4,364,490 2,209,948 3,337,831
financial institutions 464,446 152,234 495,133 406,075
Investment accounts due from designated
financial institutions - - 2,749,067 2,110,079
Financial assets at fair value through profit or loss
("FVTPL") A9 105,180 - 10,129 -
Derivative financial assets A30 173,125 167,304 120,819 166,240
Financial investments available-for-sale A10 14,627,359 10,279,997 8,487,818 8,446,589
Financial investments held-to-maturity A11 128,639 373,524 120,532 301,402
Loans, advances and financing A12 45,722,158 42,668,297 29,143,900 30,753,354
Trade receivables A13 550,737 - - -
Commodity-Gold at FVTPL 32,198 - - -
Other assets A14 100,503 61,932 50,795 53,941
Amount due from subsidiaries - - 2 196,839
Amount due from joint ventures 38,849 46,725 - -
Amount due from associate 500 500 - -
Tax recoverable 21,541 15,492 8,553 15,462
Deferred tax assets 27,185 8,056 - -
Statutory deposits with Bank Negara Malaysia 1,772,640 1,482,000 1,203,000 1,150,000
Investment in subsidiaries - - 3,063,462 575,224
Investment in joint ventures 160,594 - 163,640 -
Investment in associates 566,278 750 548,482 -
Property and equipment 466,082 401,799 425,390 394,717
Intangible assets 903,962 164,089 171,980 167,982
TOTAL ASSETS 70,008,791 60,187,189 48,972,650 48,075,735

Deposits from customers B7 50,920,229 47,633,056 33,295,153 37,106,463
Investment accounts of customers 449 - - -
financial institutions B7 5,706,599 3,547,203 3,980,305 2,583,235
Obligation on securities sold under repurchase agreements 1,050,935 999,740 954,922 999,740
Derivative financial liabilities A30 263,676 402,772 210,877 409,283
Bills and acceptances payable 42,152 37,726 42,152 37,726
Trade payables 677,022 - - -
Other liabilities A15 945,372 439,488 482,660 402,445
Deferred tax liabilities 27,859 12,884 17,841 12,884
Subordinated term loan and medium term notes B7 2,036,144 1,304,592 2,036,144 1,304,592
41
AFFIN BANK BERHAD
< ---------- GROUP ---------- > < --------- BANK ---------- >
31/12/2017 31/12/2016 31/12/2017 31/12/2016
Note RM'000 RM'000 RM'000 RM'000
EQUITY
Share capital 4,684,752 1,688,770 4,684,752 1,688,770
Reserves:-
Share premium - 858,904 - 858,904
Statutory reserves - 1,721,637 - 1,416,621
AFS revaluation reserves 97,596 75,229 121,637 93,292
Regulatory reserves 817,399 280,204 710,743 207,026
Foreign exchange reserves 151 - - -
Retained profits 2,670,888 1,178,962 1,987,315 913,359
Equity attributable to equity holders of the Bank 8,270,786 5,803,706 7,504,447 5,177,972
Non-controlling interest 58,008 - - -
TOTAL EQUITY 8,328,794 5,803,706 7,504,447 5,177,972
COMMITMENTS AND CONTINGENCIES 32,285,564 22,483,498 21,411,929 21,185,728
NET ASSETS PER SHARE (RM) 4.26 3.44
42
AFFIN BANK BERHAD
< ---------- GROUP ---------- > < --------- BANK ---------- >
31/12/2018 31/12/2017 31/12/2018 31/12/2017
No te RM'000 RM'000 RM'000 RM'000
ASSETS
financial institutions 71,801 464,446 113,610 495,133
("FVTPL") A9 606,462 105,180 373,638 10,129
Financial investments at fair value through other
comprehensive income ("FVOCI") A10 15,361,758 - 9,144,507 -
Financial investments at amortised cost A11 163,027 - 114,646 -
Financial investments available-for-sale ("AFS") A10 - 14,627,359 - 8,487,818
Financial investments held-to-maturity A11 - 128,639 - 120,532
Commodity Gold at FVTPL 42,733 32,198 - -
Other assets A14 138,884 100,503 60,423 50,795
Amount due from subsidiaries - - 420 2
Amount due from associates 57,717 500 57,217 -
Tax recoverable 62,271 21,541 31,182 8,553
Deferred tax assets 114,830 27,185 70,239 -
Statutory deposits with Bank Negara Malaysia 1,946,669 1,772,640 1,238,069 1,203,000
TOTAL ASSETS 75,976,472 70,008,791 49,130,609 48,972,650

Investment accounts of customers 875 449 - -
financial institutions B7 4,846,912 5,706,599 4,300,848 3,980,305
Obligation on securities sold under repurchase agreements 142,477 1,050,935 - 954,922
Trade payables 600,974 677,022 - -
Other liabilities A15 1,082,148 945,372 571,575 482,660
Deferred tax liabilities 7,126 27,859 - 17,841
Borrowings B7 3,053,812 2,036,144 2,548,379 2,036,144
4
AFFIN BANK BERHAD
< ---------- GROUP ---------- > < --------- BANK ---------- >
31/12/2018 31/12/2017 31/12/2018 31/12/2017
No te RM'000 RM'000 RM'000 RM'000
EQUITY
Share capital 4,684,752 4,684,752 4,684,752 4,684,752
Reserves:-
FVOCI/AFS revaluation reserves 110,371 97,596 111,161 121,637
Regulatory reserves 939,055 817,399 716,313 710,743
Foreign exchange reserves 593 151 - -
Retained profits 2,928,584 2,670,888 2,408,718 1,987,315
Stock option reserves 8,328 - - -
TOTAL EQUITY 8,741,236 8,328,794 7,920,944 7,504,447
COMMITMENTS AND CONTINGENCIES A28 30,873,074 32,285,564 20,469,123 21,411,929
CAPITAL ADEQUACY RATIOS A31
Before effect of proposed dividends :

CET 1 capital ratio 11.744% 12.213% 9.512% 10.124%
Tier 1 capital ratio 13.380% 12.232% 11.033% 10.124%
Total capital ratio 18.816% 17.231% 16.287% 14.862%
After effect of proposed dividends :

Net assets per share attributable to equity

holders of the Bank (RM) 4.46 4.26 4.08 3.86
4
AFFIN BANK BERHAD
Statements of Financial Position as at 31 December 2019
GROUP BANK
31/12/2019 31/12/2018 31/12/2019 31 /12/2018
Note RM'000 RM'000 RM'000 RM'000
ASSETS
financial institutions - 71,801 41,368 113,610
("FVTPL") A9 662,132 606,462 170,216 373,638
comprehensive income ("FVOCI") A10 12,496,846 15,361,758 6,373,844 9,144,507
Financial investments at amortised cost (''AC'') A11 145,066 163,027 100,499 114,646
Commodity Gold at FVTPL - 42,733 - -
Other assets A14 159,950 138,884 60,883 60,423
Amount due from subsidiaries - - 1,318 420
Amount due from associates 31,787 57,717 30,887 57,217
Tax recoverable 121,595 62,271 67,940 31,182
Deferred tax assets 22,520 114,830 12,690 70,239
Statutory deposits with Bank Negara Malaysia 1,534,777 1,946,669 857,377 1,238,069
Right-of-use assets 57,709 - 43,416 -
TOTAL ASSETS 68,341,262 75,976,472 42,429,819 49,130,609

Investment accounts of customers 1,447 875 - -
financial institutions B7 1,763,252 4,846,912 646,085 4,300,848
Obligation on securities sold under repurchase agreements - 142,477 - -
Trade payables 787,563 600,974 - -
Lease liabilities B7 58,650 - 44,219 -
Other liabilities A15 1,398,837 1,082,148 418,548 571,575
Provision for taxation 41 8,748 - -
Deferred tax liabilities 19,080 7,126 - -
Borrowings B7 3,607,143 3,053,812 2,548,379 2,548,379
1
AFFIN BANK BERHAD
Statements of Financial Position as at 31 December 2019
GROUP BANK
31/12/2019 31/12/2018 31/12/2019 31 /12/2018
Note RM'000 RM'000 RM'000 RM'000
EQUITY
Share capital 4,774,772 4,684,752 4,774,772 4,684,752
Reserves:-
FVOCI revaluation reserves A16 250,661 110,371 148,173 111,161
Regulatory reserves A16 732,539 939,055 471,925 716,313
Stock option reserves A16 - 8,328 - -
Other reserves A16 (61,010) - - -
Foreign exchange reserves A16 135 593 - -
Retained profits A16 3,640,073 2,928,584 3,017,227 2,408,718
TOTAL EQUITY 9,396,593 8,741,236 8,412,097 7,920,944
COMMITMENTS AND CONTINGENCIES A28 30,851,233 30,873,074 19,679,897 20,469,123
CAPITAL ADEQUACY RATIOS A31
Before deducting proposed dividends :

After deducting proposed dividends :

Net assets per share attributable to equity

holders of the Bank (RM) 4.70 4.46 4.24 4.08
1
ORGANISATION EXECUTIVE SUMMARY CORPORATE GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
230
STATEMENTS OF
FI N A N C I AL PO SI TI O N
AS AT 31 DECEMBER 2020
The Group The Bank

2020 2019 2020 2019
Note RM’000 RM’000 RM’000 RM’000
ASSETS
Cash and short-term funds 2 5,461,365 4,605,357 1,887,584 2,317,369
financial institutions 3 50,058 - - 41,368
financial institutions 4 - - 1,743,308 1,912,415
Financial assets at fair value through profit or loss (‘FVTPL’) 5 698,266 662,132 227,923 170,216
Derivative financial assets 6 388,294 164,868 231,182 118,225
comprehensive income (‘FVOCI’) 7 13,034,053 12,496,846 6,587,330 6,373,844
Financial investments at amortised cost (‘AC’) 8 143,037 145,066 361,708 100,499
Loans, advances and financing 9 45,492,878 45,387,865 25,165,425 25,730,059
Trade receivables 10 920,417 534,388 - -
Other assets 11 269,620 159,950 141,481 60,883
Amount due from subsidiaries 12 - - 299,864 1,318
Amount due from joint ventures 13 15,073 28,402 - -
Amount due from associates 14 30,885 31,787 30,885 30,887
Tax recoverable 101,675 121,595 89,480 67,940
Deferred tax assets 15 113,521 22,520 54,607 12,690
Statutory deposits with Bank Negara Malaysia 16 103,267 1,534,777 84,267 857,377
Investment in subsidiaries 17 - - 3,053,899 3,053,899
Investment in joint ventures 18 180,398 171,913 194,240 178,940
Investment in associates 19 715,716 659,527 548,482 548,482
Property and equipment 20 832,381 641,867 805,142 607,322
Right-of-use assets 21 81,870 57,709 62,875 43,416
Intangible assets 22 903,750 914,693 202,212 202,670
TOTAL ASSETS 69,536,524 68,341,262 41,771,894 42,429,819

Deposits from customers 23 49,884,360 51,088,962 27,407,977 30,135,250
Investment accounts of customers 24 2,151 1,447 - -
financial institutions 25 3,720,360 1,763,252 2,407,852 646,085
Derivative financial liabilities 26 389,819 186,791 228,089 136,439
Recourse obligation on loans/financing sold to
Cagamas Berhad 27 50,034 - - -
Trade payables 28 921,392 787,563 - -
Lease liabilities 29 50,528 58,650 31,842 44,219
Other liabilities 30 1,460,716 1,398,837 550,162 418,548
Amount due to subsidiaries 31 - - 2,229 55,899
Provision for taxation 6,240 41 - -
Deferred tax liabilities 15 1,363 19,080 - -
Borrowings 32 3,345,455 3,607,143 2,548,241 2,548,379
Share capital 33 4,902,300 4,774,772 4,902,300 4,774,772
Reserves 34 4,664,211 4,562,398 3,626,192 3,637,325
EQUITY ATTRIBUTABLE TO EQUITY
HOLDERS OF THE BANK 9,566,511 9,337,170 8,528,492 8,412,097
TOTAL EQUITY 9,637,096 9,396,593 8,528,492 8,412,097
COMMITMENTS AND CONTINGENCIES 50 36,250,193 30,851,233 20,209,442 19,679,897
The accounting policies and notes form an integral part of these financial statements.
4.3 Financial Ratio Analysis
LIQUIDITY
Current Ratio
2016 2017 2018 2019 2020

FORMULA/YEAR
RM'000 RM'000 RM'000 RM'000 RM'000
CURRENT ASSET 20,614,056 65,950,657 71,428,047 63,966,522 66,188,368
CURRENT 57,860,519 58,618,910 63,083,402 53,860,918 55,035,126
LIABILITIES
CURRENT RATIO 0.356 1.125 1.132 1.188 1.203
In 2016, the corporation faces a dilemma since it lacks the funds to meet its short-term
obligations due to a ratio of less than 1.0, which indicates current liabilities exceed current
assets. As seen in the above table, 2020, with a current ratio of 1.20, is more liquid and appears
to be in a better position to pay down its creditors. The current ratio for 2020 is higher than the
prior year. This was mostly owing to a significant growth in total current assets, such as trade
receivables, which climbed from 534,388 in 2019 to 920,417 in 2020.
PROFITABILITY
Operating Profit Margin
2016 2017 2018 2019 2020

FORMULA/YEAR
RM'000 RM'000 RM'000 RM'000 RM'000
OPERATING 749,603 541,000 632,182 652,341 352,316
PROFIT
SALES 2,553,111 2,367,624 2,419,367 2,231,836 1,806,750
OPERATING 29.36 22.85 26.13 29.23 19.50
PROFIT MARGIN
In 2020, the company's profitability will decline in comparison to the profit achieved in 2019. A
clear cause for the fall in operating profit is the drop in sales from 2,231,836 in 2019 to 1,806,750
in 2020. As a consequence, a 19.50 percent operating profit margin was produced. Perhaps as
a result of ineffective cost control, the operational profit margin decreased.
48
CAPITAL STRUCTURE AND SOLVENCY
Total Debts To Asset
2016 2017 2018 2019 2020

FORMULA/YEAR
RM'000 RM'000 RM'000 RM'000 RM'000
TOTAL 60,155,340 61,679,997 67,235,236 58,944,669 59,899,428
LIABILITIES
TOTAL ASSET 68,886,345 70,008,791 75,976,472 68,341,262 69,536,524
TOTAL DEBTS 87.33 88.10 88.49 86.25 86.14
TO ASSET
Since 2019, the overall debt has been steadily reducing for the last two years. However, the
company's total assets climbed dramatically between 2019 and 2020, from 68,341,262 to
69,536,524. Obviously, this results in a decrease in overall debt to asset value, as seen by the
leverage ratios above. In comparison to 2018, the company's financial risks were much lower
in 2019.
ASSET UTILIZATION AND EFFICIENCY
Total Asset Turnover
2016 2017 2018 2019 2020

FORMULA/YEAR
RM'000 RM'000 RM'000 RM'000 RM'000
SALES 2,553,111 2,367,624 2,419,367 2,231,836 1,806,750
TOTAL ASSET 68,886,345 70,008,791 75,976,472 68,341,262 69,536,524
TOTAL ASSET 0.037 0.034 0.032 0.033 0.026
TURNOVER
The asset turnover ratio quantifies a business's asset's efficiency in generating income or
sales. If the indicator value is insufficiently high, asset optimization should be explored. The
decline in total asset turnover from 0.037 in 2016 to 0.026 in 2020 is a negative trend, indicating
that the business is inefficiently utilising its assets to generate sales. Additionally, it might be
the outcome of excessive investment in fixed and current assets. To enhance, to expand
production, and to expand sales volume. Increased sales can be accomplished by vigorous
sales marketing.
49
4.4 Cash Flow Analysis
AFFIN BANK
Statement of Cash Flows for years ended 31 December 2016.
2016
RM'000
OPERATING ACTIVITIES
Profit 176,631
Gross dividends from subsidiaries (190,781)
Depreciation of property and equipment 84
Gain on winding-up of a subsidiary -
Amortisation of intangible assets 1
Deposits and placements with banks and other financial -
Other assets (1,851)
Other liabilities 1,161
Cash flow from operating activities (14,755)
INVESTING ACTIVITIES
Dividends received from subsidiaries 190,781
Net cash movement in amount due from/to subsidiaries (300,146)
Purchase of property and equipment (43)
Repayment of subordinated loan and other receivables 13,464
Subscription of shares in a joint venture (28,050)
Purchase of shares in an associate (19,619)
Cash flow from investing activities (143,613)
FINANCING ACTIVITIES
Increase in borrowings 300,586
Dividends paid to shareholders of the company (155,435)
Cash flow from financing activities 145,151
NCF = CFFO + CFFI + CFFF (13,217)
Beginning cash and cash equivalents 45,393
End cash and cash equivalents 32,176
50
AFFIN BANK
Statement of Cash Flows for years ended 31 December 2017.
2017
RM'000
Profit 374,388
Interest income
• Financial investments available for sale (317,057)
• Financial investments held to maturity (22,070)
Dividend income
Gain on sale
• Financial assets at fair value through profit or loss (153)
Gain on redemption of financial investments held to maturity (39,784)
Unrealised gain/loss on revaluation
• Financial assets at fair value through profit or loss 24
• Derivatives (985)
• Foreign exchange (83,221)
Depreciation of property and equipment 14,439
Property and equipment written off 107
Gain/loss on sale of property and equipment (752)
Amortisation of intangible assets 11,012
Gain on sale of foreclosed properties (2,260)
Net individual impairment 55,327
Net collective impairment 28,512
Bad debt and financing written off 1,301
Interest expense 97,750
Gain on disposal of subsidiary (162)
Cash and short term funds and deposits and placements with
banks and other financial institutions 58,353
Investment accounts (638,988)
Financial assets at fair value through profit or loss (10,000)
51
Loans, advances and financing 1,524,314
Other assets 4,139
Derivatives financial instruments (152,985)
Statutory deposits with Bank Negara Malaysia (53,000)
Amount due from subsidiaries 603,591
Deposits from customers (3,811,310)
institutions 1,397,070
Obligation on securities sold under repurchase agreements (44,818)
Bills and acceptances payable 4,426
Tax paid (88,621)
Cash flow from operating activities (1,041,940)
Interest received
• Financial investments available for sale 317,057
• Financial investments held to maturity 22,070
Dividend income
• Financial investments available for sale 1,980
Redemption of financial investments held to maturity 220,654
Net sale of financial investments available for sale 24,828
Proceeds from disposal of
• Property and equipment 2,487
• Foreclosed properties 2,330
Purchase of property and equipment (57,970)
Purchase of intangible assets (4,071)
Proceed from disposal of subsidiary 662
Subscription of shares in subsidiary (500,000)
Investments in associates
• Pursuant to the group reorganization (367,945)
• Acquisitions of shares from other shareholders (180,537)
Repayment of subordinated term loan (1,300,000)
Interest payment on subordinated term loan (66,198)
Drawdown of subordinated medium term notes 2,000,000
Payment of dividend to the shareholder of the bank (121,800)
52
NCF = CFFO + CFFI + CFFF (1,063,693)
Beginning cash and cash equivalents 3,391,038
Net increase in foreign exchange 83,221
End cash and cash equivalents 2,410,566
53
AFFIN BANK 2018
Statement of Cash Flows for years ended 31 December 2018. RM'000
Profit 674,909
Interest income
• Financial investments at FVOCI (349,298)
• Financial investments at amortised cost (5,725)
Dividend income
• Financial investments at FVOCI (970)
• Subsidiaries
(323,000)
Gain on sale
• Financial assets at FVTPL
(23,737)
• Financial investments at FVOCI
Unrealised gain on revaluation (7,175)

• Derivatives (10,355)
Property and equipment written off 14,497
Gain on sale of property and equipment 157
Amortisation of intangible assets (5,921)
Expected credit losses (ECL) written back on 13,164
• Loans, advances and financing and trade receivables
• Securities and placements
64,430
• Loans and financing commitments and financial
3,472
guarantee
(17,471)
Bad debt and financing written off
Interest expense on borrowings
3,682
Gain on winding up of a subsidiary
117,036
(21,468)
banks and other financial institutions
Investments accounts
265,627
Financial assets at FVTPL
382,371
Loans, advances and financing
(217,902)
54
Other assets
379,840
Derivative financial instruments
21,856
Statutory deposits with Bank Negara Malaysia
(61,647)
Amount due from subsidiaries
(35,069)
• Amount due from associate (339,168)
(57,453)
Deposits from customers
266,066
320,543
institutions
Obligation on securities sold under repurchase agreements
(954,922)
Bills and acceptance payable
(9,567)
Other liabilities
Tax paid (2,338)
(95,677)
Interest received
• Financial investment at FVOCI 349,298
• Financial investments at amortised cost 5,725
Dividend income
970
• Subsidiaries
323,000
Net purchase of financial investments at amortised cost
4,600
Net sale of financial investments at FVOCI
(729,951)
Proceeds from disposal of property and equipment
43,144
Purchase of property and equipment
(131,956)
Purchase of intangible assets
(1,075)
Drawdown of borrowings 500,000
Interest payment on borrowings (104,801)
NCF = CFFO + CFFI + CFFF 250,395
55
Effect of foreign exchange (7,236)
56
AFFIN BANK 2019
RM'000
Statement of Cash Flows for years ended 31
December 2019.
Profit 460,124
Interest income
• Financial investments at AC (5,725)
Dividend income
• Financial assets at FVTPL (732)
• Subsidiaries (71,000)
Gain on sale
Unrealised gain on revaluation
• Financial assets at FVTPL (4,590)
• Derivatives 5,549
Depreciation of property and equipment
16,193
Depreciation of Right of use assets
25,085
Property and equipment written off
50
Gain on sale of property and equipment
380
Amortisation of intangible assets
17,921
Gain on sale of foreclosed properties
(877)
Expected credit losses written back on
• Loans, advances and financing 7,107
• Securities and placements
(1,723)
• Loans and financing commitments and financial
guarantee
(6,758)
Interest expense on borrowings
6,117
Interest expense on the lease liability
133,800
57
1,885
banks and other financial institutions
(41,023)
Investments account due from designated financial institutions
Financial assets at FVTPL
454,268
Loans, advances and financing
208,013
Other assets
2,754,865
Derivatives financial instruments
(5,818)
Statutory deposits with Bank Negara Malaysia
(11,165)
Amount due to subsidiaries
380,692
Deposits from customers
(54,398)
(3,425,969)
institutions
(3,654,763)
Bills and acceptance payable
318
Other liabilities
(139,140)
Tax paid
(84,466)
Cash flow from operating activities (3,446,626)
Interest received
• Financial investments at FVOCI 298,820
• Financial investments at AC 5,717
Dividend income
732
• Financial investments at AC
2,392
• Subsidiaries
Purchase of 71,000

Redemption/ disposal of (4,632,067)
• Financial investments at AC 7,548,887
Proceeds from disposal of 14,444
• Property and equipment
• Foreclosed properties
238
Purchase of property and equipment
9,837
Purchase of intangible assets
(176,401)
58
Subscription of shares in a joint venture
(3,288)
Repayment of subordinated loan from an associate
(15,300)
26,528
Cash flow from investing activities 3,151,539
Increase payment on borrowings (133,800)
Payment of dividend to the equity holders of the bank (7,127)
Issuance of new shares 90,020
Lease payments (26,169)
Cash flow from financing activities (77,076)
Effects of foreign exchange 7,235
59
AFFIN BANK 2020
Statement of Cash Flows for years ended 31 December 2020 RM'000

Profit 93,069
Interest income
• Financial investments at AC (6,157)
Dividend income
• Financial assets at FVTPL (732)
• Financial investments at FVOCI (309)
• Subsidiaries (191,500)
Gain on sale
• Derivatives (1,001)
Unrealised gain on revaluation
• Derivatives Foreign 20,716

• Exchange (12,828)

Depreciation of right of use assets 26,346
Property and equipment written off 71
Gain on sale of property and equipment 181
Amortisation of intangible assets 23,157
Expected credit losses written back on (165)
• Loans, advances and financing
• Securities and placements 383,931
• Loans/ financing commitments and financial guarantee 42,591
Modification loss on contractual cash flows arising from 7,379
financial assets 47,381
Interest expense on borrowings 3,151
Interest expense on the lease liability 134,087
Cash and short term funds and deposits and placements with 1,582
banks and other financial institutions 69,256
60
Investments accounts due from designated financial institutions
Financial assets at FVTPL 167,254
Loans, advances and financing (48,302)
Other assets 130,171
Derivative financial instruments (100,078)
Statutory deposits with Bank Negara Malaysia (41,021)
Amount due to subsidiaries 773,110
Amount due from associate (352,216)
Deposits from customers (2)
Deposits and placements of banks and other financial (2,727,273)
institutions 1,761,767
Bills and acceptances payable 34,107
• Financial investments at AC 246,535

Dividend income 3,857

• Financial investmnets at FVOCI 732
• Subsidiaries 309
Purchase of 191,500
• Financial investments at AC (10,059,403)
Redemption/ disposal of (259,022)
Proceeds from disposal of 10,012,534
• Property and equipment
• Foreclosed properties 5
Purchase of property and equipment 1,020
Purchase of intangible assets (259,073)
FINANCING ACTIVITIES (139,745)
Interest payment on borrowings
Payment of dividend to the equity holders of the bank (134,225)
Issuance of new shares (139,021)
Lease payments 127,528
Cash flow from financing activities (26,008)
Beginning cash and cash equivalents (414,724)
Effects of foreign exchange 2,288,797
61
End cash and cash equivalents 12,828
1,886,901
62
5.0 CONCLUSION : Identifying The Strength And Weakness Affin Holdings Berhad
MALAYAN BANKING BERHAD
STRENGTH
As seen in the cash flow analysis above, the cash flows appear to be continuing in the same direction.
The following cash flow components have been considered: operating cash flow, investment cash flow,
and financing cash flow. As we all know, cash flows are the lifeblood of businesses, and it has been
demonstrated on occasion that a good cash flow may sustain a corporation prior to making any long-
term investments. Operating operations for 2019 indicate a positive sum of RM 4 084 433 and a
positive net growth in cash and cash equivalents of RM 1 253 489 even after accounting for investing
and financing cash flow. This strength is also shown in the profitability ratio, which is comprised of the
net profit margin ratio, gross profit margin ratio, and operating profit margin ratio, and whose trend
appears to be stable year over year.
WEAKNESS
Cash flows from investments appear to be much lower in 2019 compared to 2018. This shift might be a
result of the acquisition of long-term assets such as property, plant, and equipment, which can include
cars, buildings, land, and machinery. Additionally, it is created by the acquisition or possible disposition
of financial investments that are available for sale and held to maturity. It indicates a negative quantity of
net cash flow from investment (RM 2 118 341). It appears to be unfavourable due to increased investment
in subsidiaries (RM 415 823), as well as the negative impact of financial investment (RM 2 861 030) Cash
flow from financing appears to be negative as well. While this is less than the previous year, it still has a
negative effect on cash flow. This section contains information on debt and equity transactions. Cash
flows from financing operations include dividend payments, the buyback or sale of stocks and bonds.
This part would record funds received from a loan or cash used to pay off long-term debt. It should be
noted that the bank's net cash flow from financing is negative (RM 712 603), owing to the bank's dividend
payments to equity holders. We may also get the same conclusion about this company's investment and
financed operations by examining its capital structure and solvency ratio. According to the debt ratio,
practically all of the firm's liabilities appear to be paid by assets. A rapid adjustment in interest rates might
imperil this business's operations. When we examine the trend of the debt to equity ratio, we can notice
the ratio's shifting pattern. This demonstrates how much equity may be used to service the loan, and the
shifting trend adds to the uncertainty in this circumstance. Additionally, time interest earned appears to
be decreasing from 2018 to 2019. This implies a decline in the company's ability to invest following debt
repayment.
63
STRENGTH
Affin Bank's net cash flow in 2018 is RM 2,653,725 which is higher than the RM 1,88,901 in 2020, 2019
(RM2,288,797), 2017 (RM2,410,566), and 2016 (RM2,410,566) (RM32,176). Additionally, Affin Bank is
performing well, since its 2017 net cash flow is significantly higher than its 2019 net cash flow. The
Catering to various products segmentation. The strategy also the vast pool of the capital for further
company to growth.
Additional, Years of the financial experience for proven credibility and reliability as a sound banking and
financial institution. The great degree of appeal to government sector and have strong current ratio in
meeting short term in financial position give strength to this company.
WEAKNESSES
According to the comparison research, profit in 2020 will be somewhat lower than in 2019, at -42.24
percent. This is because the operating profit after allowances for 2020 is the lowest at RM352,316,
compared to RM652,341 in 2019, RM632,182 in 2018, RM541,000 in 2017, and RM652,341 in 2016.
(RM602,758). This is demonstrated by the massive amount of debt that Affin Bank is unlikely to collect in
2020 due to borrowers' inability to repay their obligation. The cause for the company's massive debt load
is due to the present 2020 condition of the Covid-19 epidemic, which affects the whole country, including
the banking business.
Additionally, based on ratio research, Affin Bank may face a problem as their profitability continues to
decline each year. This may be demonstrated since the asset turnover ratio quantifies the efficiency with
which a business's assets generate income or sales. If the indicator value is insufficiently high, asset
optimization should be explored. The decline in total asset turnover from 0.037 in 2016 to 0.026 in 2020
is a negative trend, indicating that the business is inefficiently utilising its assets to generate sales.
64
6.0 RECOMMENDATION
MALAYAN BANKING BERHAD
We think Maybank is a better choice today. Their achievements and honours show this every year. We
believe they should retain their strength to remain a successful bank in Malaysia. Among their strengths,
we believe they should keep commercial banking, offshore banking, offshore trust services, general
insurance, Islamic banking, investment banking, and unit trust management. This diversity of goods and
services is what makes Maybank so handy. We are certain that if Maybank can sustain and improve
these goods and services, they would become Malaysia's number one bank. They should also be able to
become ASEAN's leading financial firm.
They may also update their online banking services to better serve customers. Online banking is popular
now since it saves time. There will be no bank queues and processing time will be reduced. We may use
online banking services from anywhere as long as there is internet access. As users, we can tell that
Maybank is not functioning well in online banking, notably in their application. Maybank should stress this
if they want to stay relevant in the market.
Finally, we think Maybank should work harder on social media. We want them to fully embrace the ‘digital
world' to remain competitive.
Due to pandemic Covid-19, the existing economic circumstances for future growth in this market sector
are projected to remain weak. Based on Affin Holdings Berhad's financial performance, it is advised to
maintain existing performance with minimal re-investments. The organisation should focus on reducing
debtor collection time and increasing cash flow. Due to the industry's softening demand, Affin Holdings
Berhad should change its management aims. To generate more cash for future investments,
management must be more cautious.
65
7.0 APPENDICES
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
8.0 REFERENCES
Maybank Annual Report 2020

Maybank Annual Report 2019
Maybank Annual Report 2018, pages 35 – 36
Maybank Annual Report 2017, pages 33 – 34
Maybank Annual Report 2016. Retrieved from URL: https://www.maybank.com/iwov-
resources/corporate_new/document/my/en/pdf/annual-report/2016/Maybank_AR2015-
Financial_Statements_Book.pdf
Liquidity Ratio. Retrieved from URL: https://groww.in/p/liquidity-ratio/

Financial Analysis On Maybank And CIMB Bank Management. Retrieved from URL:
https://www.slideshare.net/echizen94/financial-analysis-on-maybank-and-cimb-bank-
management
Glossary. https://www.bnm.gov.my/files/publication/msb/2016/9/x_en.pdf
Investopedia, Current Ratio. Retrieved from URL:

https://www.investopedia.com/terms/c/currentratio.asp
Investopedia, How is the Acid-Test Ratio Calculated? Retrieved from URL:

https://www.investopedia.com/ask/answers/011315/how-do-i-calculate-acid-test-ratio-balance-
sheet.asp
Investopedia, Account Receivable (AR). Retrieved from URL:

https://www.investopedia.com/terms/a/accountsreceivable.asp
Investopedia, Operating Revenue. Retrieved from URL:

https://www.investopedia.com/terms/o/operating-revenue.asp
Investopedia, Average Collection Period. Retrieved from URL:

https://www.investopedia.com/terms/a/average_collection_period.asp
Investopedia, Debt Ratio Definition. Retrieved from URL:

https://www.investopedia.com/terms/d/debtratio.asp
85
Investopedia, NOI vs EBIT: What’s The Difference? Retrieved from URL:
https://www.investopedia.com/ask/answers/061015/net-operating-income-noi-same-thing-
earnings- interest-and-taxes-ebit.asp
Investopedia, EBIT vs Operating Income: What’s The Difference? Retrieved from URL:
https://www.investopedia.com/ask/answers/012015/what-difference-between-ebit-and-operating-
income.asp
Investopedia, Debt-To-Equity Ratio – D/E. Retrieved from URL:

https://www.investopedia.com/terms/d/debtequityratio.asp
Investopedia, Times Interest Earned (TIE) Ratio. Retrieved from URL:

https://www.investopedia.com/terms/t/tie.asp
Investopedia, Net Profit Margin. Retrieved from URL:

https://www.investopedia.com/terms/n/net_margin.asp
My Accounting Course, Operating Margin Ratio. Retrieved from URL:

https://www.myaccountingcourse.com/financial-ratios/operating-margin-ratio
My Accounting Course, Gross Profit Margin. Retrieved from URL:

https://www.myaccountingcourse.com/financial-ratios/gross-profit-margin
My Accounting Course, Times Interest Earned Ratio. Retrieved from URL:

https://www.myaccountingcourse.com/financial-ratios/times-interest-earned-ratio
CFI, Cash Turnover Ratio (CTR). Retrieved from URL:

https://corporatefinanceinstitute.com/resources/knowledge/finance/cash-turnover-ratio-ctr/
CFI, Account Receivable Turnover Ratio. Retrieved from URL:

https://corporatefinanceinstitute.com/resources/knowledge/accounting/accounts-receivable-
turnover- ratio/
Accountingformanagement.org, Fixed Asset Turnover Ratio. Retrieved from URL:

https://www.accountingformanagement.org/fixed-assets-turnover-ratio/
https://www.maybank.com/en/about-us/who-we-are/overview
86
Affin Holdings Berhad Annual Report 2020
Affin Holdings Berhad Annual Report 2019
Affin Holdings Berhad Annual Report 2018,
Affin Holdings Berhad Annual Report 2017, pages 33 – 34

Affin Holdings Berhad Annual Report 2016. Retrieved from URL :
https://affin.listedcompany.com/ar.html
Affin Bank Berhad : Company Profile and SWOT Analysis :

https://www.marketresearch.com/World-Market-Intelligence-v3764/Affin-Bank-Berhad-
Company-Profile-9148067/
https://www.slideshare.net/miorazwan/affin-bank-berhad-bsc-and-business-intelligence-tools
https://www.slideshare.net/miorazwan/affin-bank-berhad-analysis
https://www.aarkstore.com/financial-services/392475/affin-bank-berhad-strategy-swot-and-
corporate-finance-report
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FACULTY OF BUSINESS AND MANAGEMENT (BA242)

FIN 658 – FINANCIAL STATEMENT ANALYSIS

PROFESOR MADYA DR NORIZA BINTI MOHD SAAD

SUBMISSION DATE : 31 DISEMBER 2021

TABLE OF CONTENTS……………………………………………………………………… iii

DECLARATION FORM……………………………………………………………………… iv-vii

1.0 EXECUTIVE SUMMARY ................................................................................................ 1

Student’s Name : MUHAMMAD FAIZ FAKHRUDDIN BIN SHIHABUDDIN

Student’s ID : 2019845414 Student’s I/C No. : 940424-14-6143

Program Code : BA242 Part : 5 Course Code : FIN 658

Assignment/ Due Submission

PROF. MADYA. DR. NORIZA BT. MOHD SAAD

I hereby declare that this assignment/ project is written by me and:

Date Student’s Signature

/ SAT FBM Sep 2020

Student’s Name : MUHAMMAD ASYWAM BIN A’SRI

Student’s ID : 2019861586 Student’s I/C No. : 940908-03-6063

Program Code : BA242 Part : 5 Course Code : FIN 658

Assignment/ Due Submission

PROF. MADYA. DR. NORIZA BT. MOHD SAAD

I hereby declare that this assignment/ project is written by me and:

Date Student’s Signature

/ SAT FBM Sep 2020

Student’s Name : MUHAMMAD DZAHIRULHAQ BIN ZUHAIDI

Student’s ID : 2019800186 Student’s I/C No. : 990905-11-5319

Program Code : BA242 Part : 5 Course Code : FIN 658

Assignment/ Due Submission

PROF. MADYA. DR. NORIZA BT. MOHD SAAD

I hereby declare that this assignment/ project is written by me and:

Date Student’s Signature

/ SAT FBM Sep 2020

Student’s Name : MUHAMMAD HAZIM BIN MOHD ASRI

Student’s ID : 2019620422 Student’s I/C No. : 950310-14-5474

Program Code : BA242 Part : 5 Course Code : FIN 658

Assignment/ Due Submission

PROF. MADYA. DR. NORIZA BT. MOHD SAAD

I hereby declare that this assignment/ project is written by me and:

Date Student’s Signature

/ SAT FBM Sep 2020

2.1 Summary Background of Malayan Banking Berhad

Maybank's objective is to humanise financial services across Asia by providing people

2.2 Summary Background of Affin Holdings Berhad

The AFFIN Group is a significant indigenous financial services corporation. The

2.3.1 Industry Analysis of Malayan Banking Berhad

Threat of New Entrants

Bargaining Power of Buyers

The influence that customers have on a manufacturing business. By and large,

Bargaining Power of Suppliers

revenue comes from other offerings.

the license to operate.

iii. Growth in internet banking will increase the customer base.

Threat of New Entrants

Threat of Substitute Product

Bargaining Power of Buyers

Intense Rivalry among Existing Players

2.4.1 Strategy Analysis for Malayan Banking Berhad

i. Moderation in economic growth

i. The increased demand for fast banking and financing services

i. ASEAN central banks have made major headway in support of

3.1.2 Income Statement Analysis