Annual RPT 2023

Annual Report 2023
Corporate Financials Additional Information

02 Introduction 110 Directors’ Report 317 Notice of Annual General Meeting
03 Five Year Group Financial 120 Statements of Financial Position 322 Statement Accompanying Notice
Highlights 122 Statements of Income of Annual General Meeting
05 Simplified Group Statements of 123 Statements of Comprehensive 323 Other Information
Financial Position Income • Form of Proxy
06 Group Quarterly Financial 124 Statements of Changes in Equity
Performance
129 Statements of Cash Flows
07 Segmental Information
136 Summary of Significant
08 Hong Leong Financial Group Accounting Policies
Share Price
170 Notes to the Financial Statements
09 Financial Calendar Scan the QR Code to read our
311 Statement by Directors AGM reports by following these
10 Corporate Milestones simple steps:
311 Statutory Declaration
12 Awards & Accolades
312 Independent Auditors’ Report
16 Chairman’s Statement
21 Management Discussion &
Analysis
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Control Statement
To be an Integrated
Financial Services Group that
Consistently Meets Our
Customers’ Needs
2 • CORPORATE
Introduction
Hong Leong Financial Group Berhad offers an

integrated suite of conventional and Islamic
financial products and services which enables
us to reach out and connect with customers not
only in Malaysia, but throughout the region.
Commercial and Islamic Banking Investment Banking Insurance and Takaful
• Personal Financial Services • Investment Banking • Life & General Insurance

• Business & Corporate Banking • Stockbroking • Family Takaful
• Global Markets • Asset Management
• Islamic Financial Services
Core Values
Quality Progress Entrepreneurship Social Responsibility
Innovation Human Resource Honour Unity

HONG LEONG FINANCIAL GROUP BERHAD
ANNUAL REPORT 2023 3
Five Year Group

Financial Highlights
Group Total Assets Group Profit Attributable to Group Profit before Tax
(RM’Million) Owners of the Parent (RM’Million)
(RM’Million)
+9.9% y-o-y +13.8% y-o-y +5.4% y-o-y

+6.6% CAGR +7.9% CAGR +7.4% CAGR
315,266 2,791 5,102

2,452 4,840
286,921
2,265
273,280
1,919 1,858 3,972
253,603
237,883 3,506 3,300
FY2019 FY2020 FY2021 FY2022 FY2023 FY2019 FY2020 FY2021 FY2022 FY2023 FY2019 FY2020 FY2021 FY2022 FY2023
FY2019 FY2020 FY2021 FY2022 FY2023

The Group RM’Million RM’Million RM’Million RM’Million RM’Million
Statements of Financial Position
Total assets 237,883 253,603 273,280 286,921 315,266
Net loans 137,058 145,521 154,779 167,177 180,567
Total liabilities 209,282 222,550 239,347 250,931 275,636
Deposits from customers 161,888 171,237 181,769 197,383 211,467
Shareholders' funds 19,097 20,898 22,818 24,276 26,792
Commitments and contingencies 174,186 154,879 285,690 214,693 269,009
Statements of Income
Revenue 5,278 5,258 6,199 6,252 6,429
Profit before tax 3,506 3,300 3,972 4,840 5,102
Net profit 2,914 2,779 3,376 3,683 4,208
Profit attributable to owners of the parent 1,919 1,858 2,265 2,452 2,791
4 • CORPORATE
Five Year Group Financial Highlights
Group Basic Earnings per Share Group Return on Equity Group Book Value per Share
(sen) (%) (RM)
+13.8% y-o-y +0.5% y-o-y +10.3% y-o-y

+8.7% CAGR
246.1 23.62
10.9
216.3 21.41
10.4 10.4 10.4
199.8 20.13
9.3
167.8 18.43
163.6
16.78
FY2019 FY2020 FY2021 FY2022 FY2023 FY2019 FY2020 FY2021 FY2022 FY2023 FY2019 FY2020 FY2021 FY2022 FY2023
The Group FY2019 FY2020 FY2021 FY2022 FY2023
Key Performance Indicators
Share price (RM) 18.54 13.10 17.80 18.50 17.66
Book value per share (RM) 16.78 18.43 20.13 21.41 23.62
Basic earnings per share (sen) 167.8 163.6 199.8 216.3 246.1
Dividend per share (sen) 42.0 38.0 40.0 46.0 49.0
Financial Ratios (%)
Profitability Ratios
Return on equity 10.4% 9.3% 10.4% 10.4% 10.9%
Return on average assets 0.8% 0.8% 0.9% 0.9% 0.9%
Cost/income ratio 45.1% 44.9% 38.6% 37.7% 40.0%
Asset Quality/Loan Ratios
Gross loans to deposits ratio 85.4% 85.7% 86.1% 85.6% 86.2%
Gross impaired loans ratio 0.8% 0.6% 0.5% 0.5% 0.6%

Simplified Group Statements of

Financial Position
58.3% Loans, advances and financing 57.3%
3.3% Cash and short-term funds 3.1%
31.6% Portfolio of securities 31.7%
Assets Assets
2022 2023
Deposits and placements with banks 0.3%

0.5% and other FI
0.2% Statutory deposits with Central Banks 1.1%
6.1% Other assets (including goodwill) 6.5%
68.8% Deposits from customers 67.1%
Deposits and placements of banks

2.9% and other FI
3.9%
Obligations on securities sold under

1.4% repurchase agreements
2.3%
Borrowings and subordinated

0.9% obligations
0.8%
Liabilities & Equity Liabilities & Equity

0.6% Additional Tier 1 capital securities 0.5%
2022 2023
6.1% Insurance funds 6.2%
6.7% Other liabilities 6.6%
0.8% Share capital 0.7%
Reserves
7.7% (net of treasury shares for ESS) 7.8%
4.1% Non-controlling interests 4.1%

6 • CORPORATE
Group Quarterly
Financial Performance
2022
RM’Million Q1 Q2 Q3 Q4 Year
Revenue 1,559 1,544 1,503 1,645 6,252
Net profit 965 839 872 1,008 3,683
Profit attributable to owners of the parent 641 559 577 675 2,452
Share price (RM) 18.3 17.3 19.6 18.5 18.5
Dividend per share (sen) - 15.0 - 31.0 46.0
2023
RM’Million Q1 Q2 Q3 Q4 Year
Revenue 1,645 1,704 1,615 1,465 6,429
Net profit 1,039 1,161 1,064 944 4,208
Profit attributable to owners of the parent 682 771 712 626 2,791
Share price (RM) 18.5 18.6 18.0 17.7 17.7
Dividend per share (sen) - 17.0 - 32.0 49.0

Segmental
Information
Operating Revenue
By Business Segment
A 89.5% A 88.4%
B 7.6% B 9.1%
C 3.6% C 3.1%
D -0.7% D -0.6%
FY2022 FY2023
Profit Before Tax

By Business Segment
A 90.2% A 90.7%
B 8.1% B 8.6%
C 2.0% C 1.2%
D -0.3% D -0.5%
FY2022 FY2023
A Commercial Banking B Insurance C Investment Banking D Other Operations/Consolidation Adjustments

8 • CORPORATE
Hong Leong Financial Group

Share Price
Dividend per Share Share Price Market Capitalisation
FY2022 46.0 sen FY2022 RM18.50 FY2022 RM 21.2 billion

FY2023 49.0 sen +6.5% y-o-y FY2023 RM17.66 -4.5% y-o-y FY2023 RM 20.3 billion -4.5% y-o-y
Earnings per Share Group Return on Equity
FY2022 216.3 sen FY2022 10.4%

FY2023 246.1 sen +13.8% y-o-y FY2023 10.9% +0.5% y-o-y
Hong Leong Financial Group Share Price Vs Benchmark FBMKLCI

%
40
20
-20
-40
Jun ‘18 Dec ‘18 Jun ‘19 Dec ‘19 Jun ‘20 Dec ‘20 Jun ‘21 Dec ‘21 Jun ‘22 Dec ‘22 Jun ‘23
HLFG FBMKLCI
Hong Leong Financial Group Share Price & Volume
Share Price (RM) Volume
20 4.0M
3.5M
15 3.0M
2.5M
10 2.0M
1.5M
5 1.0M
0.5M
0 0M
Jun ‘18 Dec ‘18 Jun ‘19 Dec ‘19 Jun ‘20 Dec ‘20 Jun ‘21 Dec ‘21 Jun ‘22 Dec ‘22 Jun ‘23
Share Price Volume

Financial
Calendar
ANNUAL GENERAL MEETING
31 October 2023 (Tuesday)

54th Annual General Meeting
DIVIDENDS
Interim Single-Tier Dividend of 17.0 sen per share
Announcement Entitlement Payment
28 February 2023 15 March 2023 30 March 2023
Final Single-Tier Dividend of 32.0 sen per share
Announcement Entitlement Payment
30 August 2023 2 November 2023 23 November 2023
ANNOUNCEMENT OF CONSOLIDATED RESULTS
29 November 2022 31 May 2023
Tuesday Wednesday
unaudited results for unaudited results for

1st quarter ended 3rd quarter ended
30 September 2022 31 March 2023
28 February 2023 30 August 2023
Tuesday Wednesday
unaudited results for unaudited results for

2nd quarter ended 4th quarter and financial year ended
31 December 2022 30 June 2023
10 • CORPORATE
Corporate
Milestones
JULY OCTOBER APRIL JULY
2006 2007 2008 2008

Changed name to HLIB proposed to acquire HLA proposed to acquire PJ HLB acquired 20%
‘Hong Leong Financial the identified assets and City premises equity interest in the
Group Berhad’ liabilities of Southern Bank of Chengdu (BOCD)
Investment Bank Bhd
OCTOBER FEBRUARY JANUARY OCTOBER
2009 2009 2009 2008

HLCB 1:1 Rights Issue Insurance holding • HLIB obtained HLIB acquired SBB
completed company, HLAH, was investment bank status Securities Sdn Bhd
incorporated • HLB granted Vietnam
banking license
FEBRUARY OCTOBER MAY SEPTEMBER
2010 2010 2011 2012

Sichuan Jincheng consumer MSIG Strategic Partnership HLB acquired EON Capital Merger of HLIB & MIMB
finance JV incorporated completed Bhd’s assets and liabilities Investment Bank
completed
Corporate Milestones
NOVEMBER NOVEMBER FEBRUARY JUNE
2019 2020 2022 2023

HLISAM (formerly known Upliftment of suspension HLB broadened portfolio HLFG Group FY23 pretax
as Hong Leong Fund in the trading of the to include Regional profit surpassed the
Management Sdn Bhd) ordinary shares in HLCB Wealth Management RM5b mark
converted its license to an
Islamic asset management
license
JULY JANUARY DECEMBER JUNE
2018 2018 2015 2014

HLMT converted its BOCD was listed on the HLFG and HLB completed HLFG Group FY14 pretax
composite Takaful license Shanghai Stock Exchange. Rights Issues raising profit surpassed the RM3b
to a single Family Takaful HLB’s equity interest was RM1.1 billion and RM3.0 mark
license reduced from 20% to 18% billion respectively
JUNE JULY OCTOBER NOVEMBER
2013 2013 2013 2013

HLAS obtained Singapore HLB Cambodia commenced HLIB awarded ‘Best HLB established a
general insurance license operations Investment Bank Malaysia’ Representative Office in
(World Finance Awards) Nanjing, China
12 • CORPORATE
Awards &
Accolades
The Edge Billion Ringgit Club Corporate Awards 2022
Highest Growth in Profit After Tax Over Three Years -

Financial Services RM10 Billion and Above Market Capitalisation
Second Consecutive Year
Organised by The Edge Billion Ringgit Club (BRC)
HONG LEONG BANK BERHAD
Asian Banking & Finance Retail The Asian Banker Malaysia Excellence in Retail Financial Services
Banking Awards 2022 International & Country Awards 2022
Best SME Bank in Malaysia 2022 Best SME Bank in Malaysia 2022
Four consecutive years 2019, 2020, 2021, 2022
Organised by Asian Banking & Finance Organised by The Asian Banker
The Asian Banker Malaysia Excellence in Retail Financial Lembaga Hasil Dalam Negeri Malaysia - Hari Hasil Ke-27 LHDN
Services International & Country Awards 2022
Most Recommended Retail Bank by Consumers 2022 Anugerah Pembayar Cukai Terbaik Tahun 2022 - in
Recognition of HLB’s Continuous Commitment in Good
Tax Governance and Compliance
Organised by The Asian Banker Organised by LHDN
Recognised by Syarikat Jaminan Asset-Backed / Asset-Based / Covered Awarded by Green Climate Initiative
Pembiayaan Perniagaan Berhad (SJPP) Sustainability Bond of the Year 2022 (GCI)
Best Performance for a Financial Environmental Finance Bond Titanium+ Tier Certification for HLB
Institution 2022 Awards 2022 Data Centre
Organised by SJPP Organised by Environmental Finance Organised by Green Climate Initiative (GCI)
Sustainability & CSR Awards Malaysia The Edge Malaysia ESG Awards 2022 National Energy Awards 2022
2022
Bank of the Year - Financial Best Performer - Financial Best Bank - Sustainable Energy
Literacy 2022 Institution 2022 Financing - Conventional Financing
2022
Organised by Ministry of Natural Resources,
Organised by CSR Malaysia Organised by The Edge Environment and Climate Change
Asset Benchmark Research 2023 Asset Benchmark Research 2023 Asset Benchmark Research 2023
Best Trading Individual in Pan Asia 4th Best in Malaysian Ringgit Bonds - Mentioned 4 Times under
2023 Research 2023 “Highly Commended” in Malaysian
Ringgit Bonds - Sales 2023
Organised by The Asset Organised by The Asset Organised by The Asset
Global Good Governance Awards 2023 Global Good Governance Awards 2023
3G Best Sustainability Disclosure & Reporting Award 2023 3G Best Corporate Governance Framework 2023
Organised by Cambridge IFA Organised by Cambridge IFA
Awards & Accolades
HONG LEONG INVESTMENT BANK BERHAD
The Asset Triple A Islamic Finance The Asset Triple A Islamic Finance The Asset Triple A Country Awards
Awards 2022 Awards 2022 for Sustainable Finance 2022
Best Securitization Sukuk Best Project Finance Sukuk Best Green Bond
The Asset Triple A Country Awards The Asset Triple A Country Awards The Asset Triple A Islamic Finance
for Sustainable Finance 2022 for Sustainable Finance 2022 Awards 2023
Best Securitization Best IPO Best Sustainability Sukuk –

Transport
The Asset Triple A Islamic Finance The Asset Triple A Islamic Finance The Asset Triple A Sustainable
Awards 2023 Awards 2023 Infrastructure Awards 2023
Best Securitization Sukuk Best Islamic Reit Transport Deal of the Year
16th Annual Best Deal & Solution 16th Annual Best Deal & Solution 16th Annual Best Deal & Solution
Awards 2022 Awards 2022 Awards 2022
Best Domestic M&A Best Islamic Finance Deal & Most Best IPO For Retail Investors In
Deal of the Year (Malaysia) Innovative Islamic Finance Deal of Southeast Asia & Best Deal of the
the Year 2022 Year For Minority Shareholders In
Southeast Asia 2022
Organised by Alpha Southeast Asia Organised by Alpha Southeast Asia Organised by Alpha Southeast Asia
IFN Deals of the Year 2022 IFN Deals of the Year 2022 IFN Deals of the Year 2022
Malaysia Deal of the Year Structured Finance Deal of the Year Equity & IPO Deal of the Year
Organised by Islamic Finance News Organised by Islamic Finance News Organised by Islamic Finance News
14 • CORPORATE
Awards & Accolades
HONG LEONG INVESTMENT BANK BERHAD (CONTINUED)
Finance Asia Deals Award 2022 RAM Award of Distinction 2022 BPAM Bond Market Awards 2023
Best Property Deal Lead Manager Award by Number of Top ESG Issuance
Issues - Joint 3rd ranking
Organised by Finance Asia Organised by RAM Ratings Organised by Bond Pricing Agency Malaysia
2022 Lead Managers’ League Tables Euromoney Islamic Finance 2023 Bursa Excellence Awards 2022
MARC’s Innovative Deal of the Year Best Islamic Project Finance Deal Best Retail Equities Participating
Award 2022 Organisation – Investment Bank -
2nd runner up
Organised by Malaysian Rating Corporation Organised by Euromoney Organised by Bursa Malaysia
Bursa Malaysia Retail Investor Bursa Malaysia Retail Investor Bursa Malaysia Retail Investor
Campaign 2022 Campaign 2022 Campaign 2022
Top Broker for Highest Traded Top Dealer/Remisier for Highest Top Dealer/Remisier for Highest
Value for ETFs Number of New Accounts Opened Traded Value from New Accounts
Opened
Organised by Bursa Malaysia Organised by Bursa Malaysia Organised by Bursa Malaysia
Bursa Malaysia Retail Investor Campaign 2022
Top Dealer/Remisier for Highest Traded Value for ETFs
Organised by Bursa Malaysia
HONG LEONG ASSET MANAGEMENT BHD
Refinitiv Lipper Fund Awards 2023 – Refinitiv Lipper Fund Awards 2023 – Refinitiv Lipper Fund Awards 2023 –
Malaysia Provident (Funds Award) Malaysia Provident (Funds Award) Malaysia Provident (Funds Award)
Hong Leong Asia-Pacific Hong Leong Asia-Pacific Dividend Hong Leong Dividend Fund Best
Dividend Fund Best Fund Over 3 Fund Best Fund Over 5 Years: Equity Fund Over 3 Years:
Years: Equity Asia Pacific Ex Japan Asia Pacific Ex Japan Equity Malaysia Income
Organised by Refinitiv Organised by Refinitiv Organised by Refinitiv
Malaysia Provident (Funds Award) Malaysia Provident (Funds Award) Malaysia Provident (Funds Award)
Hong Leong Dividend Fund Best Hong Leong Dividend Fund Best Hong Leong Dana Makmur Fund
Fund Over 5 Years: Fund Over 10 Years: Best Fund Over 3 Years: Equity
Equity Malaysia Income Equity Malaysia Income Malaysia
Awards & Accolades
HONG LEONG ASSET MANAGEMENT BHD (CONTINUED)
Malaysia Provident (Funds Award) Malaysia Provident (Funds Award) Malaysia Islamic (Funds Award)
Hong Leong Dana Makmur Fund Hong Leong Dana Makmur Fund Hong Leong Dana Makmur Fund
Best Fund Over 5 Years: Equity Best Fund Over 10 Years: Equity Best Fund Over 3 Years: Equity
Malaysia Malaysia Malaysia
Malaysia Islamic (Funds Award) Malaysia Islamic (Funds Award) Global Islamic (Funds Award)
Hong Leong Dana Makmur Fund Hong Leong Dana Makmur Fund Hong Leong Dana Makmur Best
Best Fund Over 5 Years: Equity Best Fund Over 10 Years: Equity Fund Over 3 Years:
Malaysia Malaysia Equity Malaysia
Global Islamic (Funds Award) Global Islamic (Funds Award) Malaysia Provident (Funds Award)
Hong Leong Dana Makmur Fund Hong Leong Dana Makmur Fund Hong Leong Dana Maa’rof Fund
Best Fund Over 5 Years: Equity Best Fund Over 10 Years: Equity Best Fund Over 3 Years:
Malaysia Malaysia Mixed Asset MYR Balanced
Malaysia Provident (Funds Award) Malaysia Islamic (Funds Award) Malaysia Islamic (Funds Award)
Hong Leong Dana Maa’rof Fund Hong Leong Dana Maa’rof Fund Hong Leong Dana Maa’rof Fund
Best Fund Over 5 Years: Best Fund Over 3 Years: Best Fund Over 5 Years:
Mixed Asset MYR Balanced Mixed Asset MYR Balanced Mixed Asset MYR Balanced
Refinitiv Lipper Fund Awards 2023 – Refinitiv Lipper Fund Awards 2023 –
Global Islamic (Funds Award) Global Islamic (Funds Award)
Hong Leong Dana Maa’rof Fund Best Fund Over 3 Years: Hong Leong Dana Maa’rof Fund Best Fund Over 5 Years:
Mixed Asset MYR Balanced Mixed Asset MYR Balanced
Organised by Refinitiv Organised by Refinitiv
HONG LEONG ASSURANCE BERHAD
Malaysia Technology Excellence Awards 2023 26th Asia Insurance Industry Awards 2022
Winner of Insurtech - Life Insurance Category Group Managing Director & CEO - Woman Leader of the
Year
Organised by The Asian Business Review Organised by Asian Insurance Review
16 • CORPORATE
Chairman’s
Statement
In the year under review, the world emerged

from a prolonged period of health concern and
economic difficulty with an economic rebound
catalysed by pent-up demand for goods and
services that supported consumer spending, a
surge in travel with the opening up of borders
and increase in cross-border trades with the
easing of supply chain disruptions.
However, the growth momentum was short-lived as

inflationary pressure built up and most central banks
around the world raised interest rates in their attempt
to manage the rapid increase in the cost of living.
This weighed on the global economy and dampened
investment appetite.
On the domestic front, Malaysia's economic

growth moderated to 4.2% year-on-year (“Y-o-Y”)
supported by sustained domestic demand and low
unemployment rate even as inflationary pressure
eased with the Consumer Price Index cooling to 2.4%
in June 2023. But as a trading nation, our economy
is exposed to further deterioration in global demand
and the spillover effects of our largest trading partner
China's weaker-than-anticipated economic growth.
Chairman’s Statement
REVIEW OF THE YEAR’S PERFORMANCE
For the year under review, HLFG recorded a net profit attributable
to shareholders (“PATAMI”) of RM2,791 million, 14% higher than
the preceding financial year. HLFG’s earnings per share in FY2023
improved to 246.1 sen, from 216.3 sen in the previous financial
year. The return on equity was at 10.9%, while net assets per
share rose by 10.3% from RM21.41 to RM23.62. In FY2023, the
Board of Directors has declared a final dividend of 32 sen per
share and combined with the interim dividend of 17 sen per share
that was paid on 30 March 2023, the total dividend for FY2023
is 49 sen per share, higher than last year by 3 sen for a total
dividend payment of RM562 million.
All key capital, liquidity and credit metrics remain sound and
robust with policies in place to manage our franchise through
any exceptional economic volatility.
In respect of the performances of our key businesses, Hong

Leong Bank Berhad (“HLB”) net profit was RM3,818 million,
higher by 16% y-o-y driven by recovery in trading income,
robust contribution from its associated companies, lower loan
impairment allowances as well as the normalisation of tax rates
with the absence of last year’s prosperity tax (“Cukai Makmur”).
The commercial banking business sustained its above industry
loan growth with an 8% y-o-y expansion to its loan portfolio.
In addition, the robust state of HLB’s financials is also supported
by stringent cost control, asset quality discipline and effective
management of funding mix. HLB continued to strategically invest
in the digitalisation endeavour to provide a more interconnected
financial services ecosystem to the customers.
For our Life Insurance business, Hong Leong Assurance Berhad

(“HLA”) net profit improved by 11% y-o-y to RM284 million largely
driven by the positive impact of higher long-term MGS rates. HLA’s
Overall, the Group had successfully navigated through a gross premium contracted by 2% y-o-y to RM3,102 million due to
challenging operating environment and delivered a set of consumer caution amid a challenging economic environment and
commendable result for our shareholders. While we strive competition from higher fixed deposit rates. The focus now is to
for growth, we will maintain our focus on the Group’s revitalise our agency force as we accelerate the launch of new
strong credit quality, careful management of all risks, products to cater to the ever-changing needs of customers.
stringent cost discipline and ensure that our actions are
ESG compliant. Outside of Malaysia, the Group’s general insurance business
continued to fare better with HL Assurance Pte Ltd in Singapore
On that note, I am pleased to present our Annual Report delivering a 41% y-o-y increase in gross premium while our Hong
and Audited Financial Statements of Hong Leong Financial Kong outfit, Hong Leong Insurance (Asia) Limited registered a
Group Berhad (“HLFG” or “the Group”) for the ﬁnancial year commendable business premium growth of 20% y-o-y.
(“FY”) ended 30 June 2023.
On the investment banking front, Hong Leong Capital Berhad
(“HLCB”) reported a lower net profit of 31% y-o-y to RM50 million,
dampened by higher interest rates, weak investor sentiment
and thinner trading liquidity during the year. Profit contribution
from Hong Leong Investment Bank (“HLIB'') was affected by
the lack of larger deals, lower market activities and significantly
18 • CORPORATE
lower trading volume on Bursa Malaysia by 25% y-o-y. Our fund Concurrently, we will continue to operate on a firm financial
management business under Hong Leong Asset Management footing with prudent credit and liquidity discipline and effective
Berhad (“HLAM”) recorded a decrease in net profits by 60% to strategic cost management.
RM7.6 million due to a contraction in the Money Market Funds
segment as a result of the withdrawal of tax exemption for this CUSTOMER-CENTRIC DIGITAL OUTREACH
category of funds. Nevertheless, HLAM continued to deliver good
fund performance and was awarded with 20 individual Refinitiv In the ever-evolving world of digital technologies, the banking
Lipper Fund Awards Malaysia and Global Islamic. industry has undergone significant transformation over the
years and all players within the industry will continue to adopt
ISLAMIC BANKING & TAKAFUL BUSINESS newer technologies as they become available. Banks are actively
modularising their legacy front-end technology stacks to enable
Malaysia is one of the leading global hubs of Islamic financing the adoption of the latest cutting-edge solutions. While data
and is one of the faster growing financial business segments analytics and chatbots have been transforming the banking
driven by increasing demand for Islamic finance products. Family landscape by providing customers with personalised banking
Takaful penetration rate in Malaysia continues to rise with the experiences around the clock, the latest industry development
wider acceptance of takaful products as preferred protection places greater emphasis on the application of Artificial
schemes. Intelligence and Machine Learning. The Group recognises the
merits of innovative digital solutions for our customers but never
Our Hong Leong Islamic Bank Berhad (“HLISB”) was successful at the expense of IT security. To that end, we are committed to
in capturing new growth opportunities to register a net profit of continuously upgrade our service delivery and judiciously invest
RM425 million which is higher by 43% y-o-y with encouraging in technologies to protect the security of our customers data as
financing book growth of 13% y-o-y to RM41 billion. The stellar part of our “Digital at the Core” strategy.
performance was underpinned by topline growth and lower loan
impairment allowances. Our commercial banking business, HLB, is committed to invest
in market-relevant capabilities. The priority is to find fresh
For Family Takaful, Hong Leong MSIG Takaful Berhad (“HLMT”) approaches to leverage on technology in delivery of banking
continues its strong trajectory with a 20% y-o-y growth in gross products and services. Today, HLB is serving 2.6 million or
contribution to RM654 million in FY2023. Gross contribution almost three-quarters of its retail banking customers digitally. In
from the agency channel grew by 37% y-o-y underpinned by addition, more than 120,000 business customers' banking needs
new product innovation and robust agency recruitment. HLMT are fulfilled over their digital platforms.
complements our Financial Group’s Islamic financial service
franchise and offers attractive growth potential given that Takaful Likewise, HLA has been judiciously redirecting its resources to
in Malaysia remains largely underpenetrated. invest in digital capabilities and to embrace the adoption of
latest technologies to grow its customer base. Over the past 5
STRATEGIC PRIORITIES years, the total number of registered users for our insurance
Customer Portal HLA360° has increased by three (3) fold to about
The Group’s philosophy embodies an entrepreneurial vision 430,000. Additionally, they are also employing robotic process
focused on building long-term sustainable value for all of our automation solutions in areas such as customer screening
stakeholders. With value creation at the heart of our strategic and data processing. Separately, both of our overseas general
priorities, we strive to add new dimensions and business lines insurance businesses continue with their digital-led and data-
to the Group. driven business model with a sharp focus on enhancing their
online distribution proposition.
Our business focus for the upcoming financial year and onwards
will be to unlock wealth management opportunities, boost Customers’ demand for a better digital experience has accelerated
insurance distribution capabilities and strengthen foreign fund due to the rapid pace of change across the services industry. At
management capabilities. We will also continue to employ HLCB, our investment banking outfit achieved a new milestone
cutting-edge technologies and digital solutions for better insight with the launch of a Shariah trading platform and its fully
into our businesses, simplify operational processes and most digitalised stockbroking account opening experience.
importantly, to enhance customer engagement experience.
Digitisation remains a core part of the Group’s business strategy. Policy, and Whistleblowing Policy. Regular reviews were carried
In delivering long-term sustainable growth to stakeholders, HLFG out to ensure effectiveness. Transparent communication and
is committed towards investing in digital capabilities and aspires understanding are crucial across the organisation, with employees
to provide best-in-class touchpoints to customers across all our attesting to key policies. Compliance controls are diligently
operating businesses. monitored, with results reported to the relevant committees. In-
house and external training sessions further enhance governance
FUTURE-READY WORKFORCE awareness among directors and employees.
Our employees are our most important asset; the future success OUR SUSTAINABILITY ENDEAVOUR
of the Group has a direct correlation with the talent we have in our
group of companies. The key to realising our vision is predicated The Board and Management of the Group is firmly committed
on our commitment in attracting, nurturing and retaining talent. to sustainable corporate governance and stewardship. We are
As, we continually seek to equip our employees with the right guided by our corporate values to make the right decisions that
tools and capabilities to effectively drive change, we foster will hold us in good stead today and in the future, improving the
a work environment that promotes closer collaborations and well-being of our people, our communities and the environment
shared values that can bind us together. that we live in. It is our priority to entrench sustainability principles
throughout the Group and integrate the same into every aspect
We value a working environment that makes every employee of our operating footprint.
feel appreciated while embracing our diversity regardless of their
age, religion, nationality, gender or background. Every employee The effects of climate change are becoming increasingly
has an equal opportunity to grow and succeed. To this end, the noticeable in Malaysia. In recent times, the country has been
Group will continue to make investments in the professional experiencing extreme weather events with the latest being the
development of our workforce to provide them with the skills floods in Johor which affected over 50,000 of our countrymen. It
needed to respond to the business environment's constant is imperative for us to act and do our part in the global efforts in
change. arresting broader environmental degradation caused by climate
warming.
HIGH STANDARD OF GOVERNANCE
In FY2023, the Group has expanded our coverage of GHG
emissions monitoring to include Scope 3 employees commuting.
We are committed to upholding a high standard of governance,
Collectively, our footprint has reduced the combined GHG emission
emphasizing corporate responsibility, transparency, and
by 18% over the past four (4) financial years. On 19 June 2023,
accountability by continuously enhancing our risk management
HLFG was recognised for its efforts in embracing sustainability
frameworks to proactively address emerging risks, and adapting
with an improved score and continues to be a constituent of the
to the evolving needs of the dynamic operating environment. FTSE4Good Bursa Malaysia index for the 5th consecutive year.
Our Board and management work collaboratively to align long-
term sustainable strategies with the interests of our shareholders Across the Group, our key operating entity, HLB has been
and stakeholders. recognised through the Special Award for Sustainable Energy
Financing by Domestic Bank in 2022 for their renewable energy
Our dedication is grounded in ethical business principles with financing commitment which reached an approved sum of
zero tolerance for bribery and corruption. We foster a culture RM3.2 billion at the end of FY2023. In the same period, in its
of compliance and integrity, adhering to best practices for effort to strengthen the commitment to low carbon transition,
accountability and transparency. For the Board to properly carry HLB became a signatory to the Partnership in Carbon Accounting
out its oversight functions and obligations, a corporate governance Financials (“PCAF”) and started monitoring financed emissions.
framework has been put in place. The Group Board Information
and Technology Committee ("GBITC") provides oversight on During the year, our insurance division, HLA, has accelerated
technology matters and cyber security, while the Board Audit its endeavour of becoming a leading sustainable life insurer
and Risk Management Committee ("BARMC") oversee matters in Malaysia with the unveiling of an ambitious sustainability
involving risk management, compliance, and internal controls. campaign, ‘Saving Our Planet Saves Us’. Several sustainable
initiatives under the campaign encompasses the launch of HLA
We implement comprehensive group-wide policies and Global ESG Fund, reduction of GHG emissions, roll out of eco-
procedures, including the Board Charter, Code of Conduct and Ethics, friendly practices, climate awareness education and community
outreach programmes.
Anti-Bribery and Corruption Policy (ABC), Gifts and Entertainment
20 • CORPORATE
Additionally, HLA has also integrated ESG considerations into healthy labour market conditions and investor-friendly initiatives
its investment process guided by BNM’s Climate Change and by the Malaysian government to spur both domestic and foreign
Principle-Based Taxonomy (“CCPT”) and will monitor its investment direct investments.
portfolio to shift towards climate-friendly investments that share
the same values toward building sustainable business practices. The Group’s fundamentals and financial position remain solid
backed by robust capital and healthy liquidity levels, prudent
Last year, the Group’s investment banking division introduced the cost management and uncompromised credit discipline. Moving
Sustainability Framework which is guided by four central pillars, forward, we shall continue to invest in our human capital,
namely Engaging on Sustainability, Addressing Climate Change, accelerate our digitalisation transformation while keeping a
Strengthening Internal Capabilities and Impactful Digitalisation. sharp focus on risk management and further integrate ESG
On 19 December 2022, HLCB was admitted to the Bursa Malaysia considerations into the way we conduct our business to deliver
FTSE4Good Index, a recognition of its efforts in embracing sustainable business performance and long-term value for all
sustainability. Our asset management company, HLAM launched stakeholders.
its Shariah-compliant ESG fund, namely Hong Leong Global
Shariah ESG Fund, to provide access to sustainable investing to ACKNOWLEDGEMENTS
its client base.
I would like to take this opportunity to extend my heartfelt
As we strive for greater integration of the sustainability agenda in
thanks and appreciation to my fellow Board members for their
the way we operate, the focus is to grow our Group responsibly
insightful wisdom and support. Our employees, who deserve
and at the same time, contribute positively to our environment,
special acknowledgement for their dedication and commitment
customers, employees and communities.
to upholding the Group’s core values. Special recognition to
our senior management team for their invaluable contribution
LOOKING AHEAD through all our endeavours.
At the time of writing, the global economy’s near-term outlook

Finally, I would like to express my gratitude to our regulators,
remains uncertain and is anticipated to soften amid weaker
government authorities, shareholders, customers, business
global demand and elevated inflation. Although there are signs
partners and the community we serve for their continued faith
that interest rate upcycle is nearing its peak, the prospect of
and confidence in Hong Leong Financial Group.
a pause in rate hike remains uncertain with the recent rally
in crude oil prices that may fuel further inflationary pressure.
The International Monetary Fund (“IMF”) has projected global
GDP to moderate from 3.5% in 2022 to 3.0% in 2023 and 2024.
Likewise, Malaysia’s trade-reliant economy, sensitive to these QUEK LENG CHAN
macroeconomic headwinds is expected to moderate but remain Chairman
on a positive trajectory, supported by resilient domestic demand, 20 September 2023
Management
Discussion & Analysis
The Malaysian economy continued its positive trajectory for first half of
FY2023, boosted by a combination of solid domestic demand and robust
external trade following the relaxation of pandemic measures and full
reopening of global economies. However, in the second half of FY2023,
the domestic economic growth moderated as external demand softened
amidst persistent inflationary and elevated cost of funding conditions.
While external trade contracted, the domestic demand remained resilient
with pick-up in consumption, underpinned by policy support and a robust
labour market that helped cushion the slowdown in net exports.
The domestic banking sector’s margins benefited from the Overnight Policy Rate (“OPR”) increase of 75 bps to pre-pandemic levels
of 3.00%. That said, the positive impact of the OPR has been curtailed by intensified deposit competition and normalisation of
banks’ funding profiles, especially in the latter part of FY2023. As for the capital markets, it was a challenging financial year that
was faced with a lower Bursa Malaysia trading volume and higher interest rates subduing new bond issuances and customers’
appetite for investments in unit trust.
22 • CORPORATE
Management Discussion & Analysis
Against this backdrop, our business operations and financial performance showcased resilience throughout FY2023. The Group
attained a net profit attributable to shareholders (“PATAMI”) of RM2.8 billion, marking a robust 13.8% improvement compared
to the preceding year. This improvement primarily stemmed from robust contributions within our core businesses, notably the
commercial banking division and insurance division. In line with our overarching strategy of being "digital at the core," we not only
achieved commendable financial outcomes but also fortified our business franchises to ensure sustained growth over the long term.
On that note, we are pleased to present the Management Discussion and Analysis (“MD&A”) for the financial year ended 30 June
2023 (“FY2023”). In this report, we would like to provide a review of Hong Leong Financial Group Berhad’s (“HLFG” or “the Group”)
business operations and financial performance during FY2023.
HLFG GROUP PERFORMANCE HIGHLIGHTS
Hong Leong Financial Group Berhad is an investment holding company and has three core businesses in the group:
• Commercial and Islamic banking under Hong Leong Bank Berhad (“HLB”);
• Insurance and Family Takaful, housed under our insurance holding company HLA Holdings Sdn Bhd (“HLAH”); and
• Investment banking and asset management under Hong Leong Capital Berhad (“HLCB”).
The Group recorded a Profit Before Tax (“PBT”) of RM5,102 million, an increase of 5.4% year-on-year (“y-o-y”), and a PATAMI
of RM2,791 million, an increase of 13.8% y-o-y attributed to higher contributions from the commercial banking division and
the insurance division, while the investment banking division recorded lower contribution. The commercial banking segment
contributed more than 90% of the Group’s PBT. The robust performance of HLB was primarily driven by top-line growth, prudent
cost management, lower loan impairment allowances, and strong contributions from associates.
For asset quality, the gross impaired loan ratio (“GIL”) stood at 0.57%, well below the industry GIL ratio of 1.75%. This is attributed
to our proactive strategies, including preventive measures and tactical action plans for accounts in arrears, effective management
of high-risk accounts, customer site visits, and the implementation of targeted programmes to address both pre-impaired and
impaired accounts.
HLFG achieved a Return on Equity (“ROE”) of 10.9%, and our book value per share improved by 10.3% y-o-y to RM23.62. Accordingly,
the Board of Directors declared a final dividend of 32 sen, resulting in a full-year dividend of 49 sen. This marks a 3 sen increase
from the previous financial year.
The Group maintains a prudent capital and risk management approach to ensure our operating businesses remain resilient and
adequately capitalised to achieve our business objectives. The Group’s consolidated capital positions surpass regulatory requirements,
with Common Equity Tier 1, Tier 1, and Total Capital Ratios at 11.0%, 12.1%, and 14.6% respectively as of 30 June 2023.
In terms of corporate credit rating, RAM Rating Services Berhad (“RAM”) has reaffirmed AA1/Stable/P1 Corporate Credit Ratings
for HLFG and maintained the Financial Institution Ratings of HLB, HLISB and HLIB at AAA/Stable/P1, acknowledging the superior
asset quality of our businesses. Meanwhile, Moody’s Investors Services Ltd has reaffirmed HLB’s baseline credit assessment at
A3, underpinned by HLB’s robust retail and small and medium enterprise (SME) franchises as well as effective risk management
practices.
During the financial year, the Group received various external recognitions of achievements for our operating companies. Notably,
the Special Award for Sustainability Energy Financing by Domestic Bank in 2022 for HLB, Woman Leader of the Year award at the
26th Asia Insurance Industry Awards 2022 and Insurtech – Life Insurance at the Malaysia Technology Excellence Awards 2023 for HLA,
Best Domestic M&A Deal of the Year in Malaysia and eight prestigious awards accorded by various other channels to HLIB, while
our fund management HLAM also won 20 individual awards at the Refinitiv Lipper Fund Awards Malaysia 2023 and Refinitiv Lipper
Fund Awards Global Islamic 2023.
Net Profit Attributable to EPS ROE

Shareholder (Sen) (%)
(RM’Million)
246.1
2,791
234.2
2,655
17.9
203
11.3
10.9
0.9
2,452 216.3 10.4
FY2022 FY2023 FY2022 FY2023 FY2022 FY2023
Normalised
Cukai Makmur (Prosperity Tax)
PBT contribution by business segments for FY2022 and FY2023
Commercial Banking
68.9% (exclude China associates)
65.4%
21.3% China Associates 25.3%
6.3% Life Insurance 7.1%
FY2022
FY2023
1.8% General Insurance 1.5%
0.9% Stockbroking 0.6%
0.6% Investment Banking 0.3%
0.5% Asset Management 0.2%
-0.4% Others -0.4%
Notes:
- General Insurance includes 30% profit contribution from MSIG Insurance (Malaysia) Bhd
- Life Insurance includes Family Takaful
- Others (includes consolidation adjustments)
24 • CORPORATE
COMMERCIAL BANKING FINANCIAL & OPERATIONAL REVIEW
HLB Financial Highlights FY2022 FY2023 Growth (%)
Profitability & Efficiency (RM’Million)

Revenue 5,597 5,686 1.6%
Operating Profit 3,499 3,452 -1.3%
Profit Before Tax (“PBT”) 4,367 4,627 6.0%
Profit After Tax (“PAT”) 3,289 3,818 16.1%
Earnings Per Share (sen) 161 186 15.5%
Net Interest Margin (“NIM”) (%) 2.14% 1.98% -0.16%
Cost-to-Income Ratio (“CIR”) (%) 37.5% 39.3% 1.8%
Return on Assets (%) 1.34% 1.43% 0.09%
Return on Equity (%) 10.9% 11.8% 0.9%
Balance Sheet (RM’Million)

Total Assets 254,331 279,850 10.0%
Gross Loans, Advances and Financing 168,234 181,677 8.0%
Customer Deposits 197,292 211,652 7.3%
Asset Quality
Gross Impaired Loan Ratio 0.49% 0.57% 0.09%
Loan Impairment Coverage Ratio (“LIC”) 212% 169% -43%
LIC (provisions made on GIL and security value) 282% 239% -43%
Liquidity and Capital Ratio

Loan-to-Deposit Ratio 83.5% 84.3% 0.9%
Common Equity Tier-1 Capital Ratio 13.4% 12.8% -0.6%
Tier 1 Capital Ratio 14.5% 13.9% -0.7%
Total Capital Ratio 16.7% 15.9% -0.8%
HLB’s regional financial services are provided via:
• A branch in Singapore;
• A branch in Hong Kong;
• 100% owned commercial bank Hong Leong Bank Vietnam Limited;
• 100% owned commercial bank Hong Leong Bank (Cambodia) PLC;
• 19.8% equity interest in the Bank of Chengdu Co., Ltd; and
• 12% equity interest in the Sichuan Jincheng Consumer Finance Limited Company.
Profitability & Efficiency outpacing the industry growth. Residential properties segment
registered an encouraging 8.1% y-o-y expansion to RM89.1
In FY2023, HLB achieved a net income of RM5,686 million, driven billion, driven by a strong loan/financing pipeline. Transport
by strong loan/financing expansion and increased non-interest vehicle loans/financing reached RM19.6 billion, marking a 10.9%
income contribution. Non-interest income surged by 15.8% y-o-y y-o-y growth that was boosted by vigorous motor vehicle sales
to RM1,133 million in FY2023, fuelled by higher credit card fees, activities, sales tax exemptions, and promotional campaigns
trade finance activities, and foreign exchange performance, from car manufacturers.
resulting in an improvement to the non-interest income ratio of
19.9%. Fee income remained steady at RM599 million, where SME segment reported encouraging growth, advancing by
growth in credit card-related fees and improved trade finance 9.7% y-o-y to RM33.0 billion. The HLB’s steadfast support for
activities was offset by lower wealth management income from SMEs in their business and financial needs was instrumental
reduced sales commission. During the financial year, net interest in this expansion. Within the SME portfolio, the community
margin (“NIM”) came under pressure with the heightened cost of banking initiative demonstrated solid performance, leading to
funds arising from a combination of intense deposit competition a commendable 13.2% y-o-y growth. This can be attributed to
in both retail and wholesale markets and the impact from banks proactive and innovative efforts to meet client needs, along with
striving to comply with the Statutory Reserve Requirement the implementation of digitalised onboarding initiatives.
(“SRR”). This led to a NIM compression from 2.14% to 1.98% on
y-o-y basis. Total customer deposits achieved a 7.3% y-o-y growth to
RM211.7 billion in FY2023, primarily driven by higher fixed
Operating expenses were prudently managed at RM2,233 million deposits. Domestic customer deposits, constituting 91% of
through our strategic cost management initiatives, while keeping the total deposit base, grew by 5.1% y-o-y to RM192.9 billion.
the cost-to-income ratio (“CIR”) solid at 39.3%. Personnel costs Core customer deposits, encompassing demand, savings,
accounted for 54% of total operating expenses, increased by and fixed deposits, constituted 84% of HLB’s total customer
4.3% y-o-y from higher salaries and allowances. Sales-related deposit base experienced 10.9% y-o-y growth. The CASA ratio
expenses, namely in sales incentives and card-related expenses stood at 30.8% reflecting HLB’s continued prioritisation of cash
were higher for the financial year driven by increased sales, management solutions and community acquisition initiatives,
merchant volume and retail spending in line with the recovery while fixed deposits expanded 19.6% y-o-y to RM112.2 billion
of economic activities. which represented a domestic market share of 8%. HLB Loan-to-
Deposit ratio stood at 84.3% and a Loan-to-Fund ratio of 86%,
Notwithstanding the market challenges, HLB delivered a higher placed HLB in a robust funding and liquidity position to support
PBT of RM4,627 million or 6.0% y-o-y increase underpinned by sustainable business growth, while a strong liquidity coverage
our solid fundamentals, robust underlying performance, reduced ratio of 136.4% provides ample coverage of short-term liquidity.
loan impairment allowances and strong contributions from
associates. The higher contributions from associates are mainly Asset Quality & Capital Adequacy
attributable to Bank of Chengdu (“BOCD”), our associate in China.
The share of profit from our China associates recorded a 25.1% HLB asset quality remained healthy with a GIL ratio of 0.57%.
y-o-y upswing to RM1,289 million, accounting for approximately The loan impairment coverage ratio (“LIC”) closed at 169% and
28% of the bank’s PBT. Profit After Tax increased to RM3,818 inclusive of provisions made and the value of securities held
million or 16.1% y-o-y due to the normalisation of tax rates on the GIL, the LIC ratio is even higher at 239%. HLB’s capital
with the absence of last year’s prosperity tax (“Cukai Makmur”). positions remain adequate to support the sustained business
Correspondingly, HLB’s ROE climbed to 11.8% from 10.9%, and growth, with Common Equity Tier 1, Tier 1 and Total Capital Ratios
earnings per share improved to 186 sen from 161 sen in FY2022. at 12.8%, 13.9% and 15.9% respectively.
Balance Sheet & Liquidity HLB maintained a balanced approach between growth and
proactive capital management to ensure sustainable dividend
Gross loans, advances, and financing sustained a growth trajectory, payouts to the shareholders. HLB has declared a final dividend
expanding by 8.0% y-o-y to RM181.7 billion. HLB’s domestic of 38 sen per share, bringing the total dividend to 59 sen per
loans/financing constituted 92% of its total loan/financing share for the current financial year, with a dividend payout ratio
portfolio and registered a 7.2% y-o-y increase to RM167.7 billion, of 32.0%.
26 • CORPORATE
Personal Financial Services (“PFS”) which allows customers to seamlessly invest in unit trusts
with a wide selection of funds accompanied by comprehensive
The PFS business remained the largest contributor to HLB in investment insights. In addition, the bank also launched our
FY2023 and contributed to HLB’s revenue and PBT of 56% and cross-border QR capability on the HLB Connect App that allows
38% respectively. PFS recorded strong loan/financing growth of our customers the convenience to make payments digitally to
7.1% y-o-y and low GIL ratio of 0.45% driven by a 6.7% expansion merchants in Thailand, Indonesia, and Singapore during their
in the mortgage business, with a focus on the affordable housing travels.
segment, and first-time homebuyers. The auto loan business
achieved strong growth attributed to several factors such as Looking ahead, PFS is committed to sharpen our brand promise
the introduction of new car models, the availability of sales tax of “Built Around You” to drive exponential customer growth
exemptions, and attractive promotional campaigns from car and deliver a personalised retail banking experience. The bank
manufacturers. This was also bolstered by a 66% growth in Green aims to leverage on the growing popularity of HLB Connect and
Car Financing for Hybrid and Electric Vehicles (EV) segments. In enhance customer onboarding and service processes, particularly
terms of personal loans, the business experienced marginal for underserved segments while building an integrated and agile
growth as borrowers adjusted to higher loan instalments from payments strategy that caters to our customers' needs.
interest rate hikes that weighed on demand. We have taken a
proactive stance to address the adverse impact through portfolio Regional Wealth Management (“RWM”)
diversification, risk-based pricing, enhanced risk assessment and
collections strategy. RWM business was a standout performer with a strong PBT
growth of 23% y-o-y despite the challenging operating
PFS CASA performed admirably with new accounts acquisitions environment. Revenue growth for fixed income was higher at
rising 48% y-o-y, which led to a 7.3% y-o-y rise in customer 53% y-o-y given the significant interest in fixed income products
deposits base. During the financial year, HLB introduced the in line with the rise in interest rates. This spilled over to cross-
innovative multi-currency e-wallet, designed for a convenient selling opportunities of foreign exchange (“FX”) products, where
digital payment experience with an instant cashback feature revenues nearly doubled this financial year. Our deposit franchise
for our customers that travel overseas. Several initiatives contributed to a 4% y-o-y growth in segment deposits and an 8%
were launched to serve the often-underserved sole proprietor y-o-y increase in Assets Under Management (“AUM”).
segments, that garnered a 9.3% y-o-y growth in non-individual
account balances. The bank launched the Pay & Save Sole Prop Bancassurance recorded a solid credit insurance sales growth of
multi-currency deposit product that enabled business owners to 23% y-o-y, primarily driven by the expansion of the mortgage
transact in twelve (12) currencies with interest-bearing features. business but the savings products were impacted by the weak
In addition, our “Cashless Lagi Senang” solution continues to equity markets environment. On the digital front, the bank
support small business owners in accepting digital payments launched the HLB Wealth investment feature in HLB Connect, that
effortlessly. We remain committed towards uplifting and enables customers to transact unit trust digitally with plans for
empowering underserved communities and supporting them via enhancement to include a wealth position dashboard providing
access to superior digital banking and customer experience. real-time information.
HLB’s brand promise of “Built Around You” defines the way we

deliver exceptional financial solutions and unique digital banking
experience for our customers. Our digital platform, HLB Connect
registered a 16% y-o-y increase in user base with over two million
users, of which 73% are active monthly users of the platform.
Retail transactions conducted via Connect have grown by 12%
y-o-y, representing 93% of the Bank's total retail transactions.
HLB also experienced significant growth in product take-up
through digital channels, as approved credit cards climbed 62%
and flexi payment plans popularity improved by 75% in sign-up
via Connect.
During the financial year, HLB Connect App rolled out several
enhancements, namely the new innovative HLB Wealth feature
Moving forward, RWM will remain vigilant in monitoring market our regional offices, to support our customers' competitiveness
conditions amidst prevailing economic headwinds and the impact by facilitating our customers’ expansion into these markets
of higher interest rates on investment outlook. Nonetheless, and streamlining capital and transaction flows for SMEs and
we are confident in our ability to meet our clients’ investment corporates engaged in import and export activities.
appetite by enhancing our investment offerings and adapting our
products to meet our customer needs. Global Markets (“GM”)
Business & Corporate Banking (“BCB”) In FY2023, GM operated under tough and volatile market
conditions including lower portfolio yields, mark-to-market
BCB business has delivered a commendable set of results with impact on bond portfolios and pressure from higher funding
7% y-o-y growth in loan/ financing, outpacing the industry cost coupled with lower FX transaction volume. Despite these
average. Our strategic focus on small and medium enterprise challenges, Global Markets recorded a PBT of RM163 million
(“SME”) and commercial client segments yielded encouraging accounting for 5% of the HLB’s PBT.
results that led to expansion in loan/financing by 12% and 8%
y-o-y respectively, while the demand deposits grew 5% y-o-y. During the financial year, GM collaborated closely with internal
Overall, BCB contributed 29% and 25% to HLB’s revenue and PBT partners and clients to deliver innovative treasury solutions with
respectively. an enhanced treasury module, HLCF Live, that allowed corporate
clients to directly book spot FX rates with the bank to also include
BCB had been actively supporting domestic businesses recover forward FX contracts. This has helped to drive FX volume within
to a stronger footing from the economic scars of the pandemic our SME and corporate segments.
by providing working capital facilities, offering bank-initiated
payment relief assistance, and facilitating government financial Our GM team’s performance received recognition from a leading
assistance programmes. Our SME Banking segment achieved an publication, The Asset that earned it accolades for Best Local
above-industry loans portfolio growth rate of 12% y-o-y, whilst Currency Bond Individuals in Trading and Research, and Highly
maintaining healthy portfolio asset quality. The bank has also Commendable Persons in Sales for FY2023. This recognition
doubled the size of our SME Cash, Trade, and Foreign Exchange further solidified HLB’s prominent position in the local institutional
(“CTFX”) team from the prior year to enhance our ability and space.
capacity to service the evolving clients’ transactional and hedging
needs. Islamic Banking
BCB is committed to deliver exceptional customer experiences Hong Leong Islamic Bank Berhad (“HLISB”) recorded strong
through our digital banking innovations. We have enhanced our performance in FY2023, with Profit before Zakat and Taxation
corporate internet banking platform Hong Leong ConnectFirst (“PBZT”) increasing to RM567 million or 29.2% y-o-y. This
(“HLCF”) to include improved digital onboarding experience for laudable performance was driven by a 5.1% y-o-y increase in
account opening and rolled out various new features including operating profit with credit costs reducing by 46.3% y-o-y, while
multilingual options, introduction of eTokens usage, and preserving disciplined cost management with a cost-to-income
incorporation of a treasury module for FX transactions. In terms ratio of 29.7%. HLISB grew its retail and commercial segments
of new products, BCB launched the PrimeBiz Current Account, a with a 10% expansion in assets, reaching RM57 billion. This
business current account service that offers rebates for current raised its gross financing higher by 13% y-o-y, surpassing the
account balances to offset against selected banking charges. The industry average of 9%.
bank has also intensified its customer engagement and outreach
efforts through nationwide Transaction Banking roadshows, HLISB aims to be a one-stop Islamic bank that provides innovative
where our experienced specialists shared valuable insights into financial solutions tailored to the diverse and evolving needs of the
market outlook and showcase how BCB can support our SME communities that we serve. We are committed to offer innovative
customers to take advantage of potential market opportunities. digital banking solutions while adhering to our core values of
Shariah-compliant financial services. The PFS-i business achieved
BCB remains a key growth engine for the bank. BCB will stand by solid growth backed by our digital strategies that serviced our
our customers and offer a comprehensive range of financing and customers through a simplified banking journey. During the year
banking services as businesses navigates a challenging operating under review, the active users for both Retail Connect Internet
condition. We aim to expand our business banking coverage to Banking and Retail Connect Mobile Banking increased 16% y-o-y,
28 • CORPORATE
indicating the growing preference for digital banking solutions strengthening its presence in Chongqing and other branches
among our clientele. We have also widened our offerings and outside Chengdu city limits to further solidify its leading position.
introduced two new Islamic Structured Products as part of our BOCD will focus on enhancing its competitiveness to become the
Islamic Wealth Management Shariah compliant offerings to cater preferred bank for enterprises and residents in the region that it
for clients that seeks more sophisticated products. operates.
Likewise, HLISB’s BCB-i recorded an impressive financing growth In Vietnam, Hong Leong Bank Vietnam (“HLBVN”) delivered a
rate of 14.3% y-o-y, with the SME segment improving 19.8% y-o-y stellar performance that saw total income improving by 33%
largely attributed to our expansion and outreach efforts to SME y-o-y, and PBT increasing by 115% to reach RM24 million on
customers through a close-knit collaboration with Hong Leong the back of a robust loan growth of 18% y-oy, better NIM and a
Bank Group and our extensive branch network nationwide. To superior GIL ratio below 0.10%. While Hong Leong Bank Cambodia
promote SME growth, we have introduced the MicroSME financing (“HLBCAM”) maintained a steady loan portfolio of RM2.6 billion
and Islamic SME Grow programmes as part of our partnership with a total assets size of RM3.4 billion as of June 2023. The
with SME Corporation via the Shariah-Compliant SME Financing strategic priorities for HLBCAM are focused on accelerating
Scheme 3.0 (“SSFS 3.0”). Our support for the Halal sector remains customer acquisition and growing the local deposit base, while
strong and has yielded a commendable growth rate of 12.1% effectively managing and expanding the lending book with
y-o-y. We continue to strengthen our staff force and enhance qualified existing customers.
their expertise in this field. Nine of our full-time staff have
qualified as Halal Executives under the Majlis Profesional Halal, For HLB’s overseas branches, Hong Leong Bank Singapore (“HLBS”)
JAKIM training programme, and the bank is actively involved in reported an operating profit of RM86 million and revenue of
numerous business-focused research activities and knowledge- RM223 million. Gross loans/financing grew significantly by 22.9%
sharing programmes within the community that we serve. y-o-y to RM9.4 billion, spurred by a strategic shift to expand into
BCB and targeted PFS segments. At Hong Leong Bank Hong Kong
On sustainability and financial inclusion, HLISB takes pride in (“HLBHK”), the branch saw its loan growth double from prior
empowering our customers to transition toward a low-carbon year as it focuses on SMEs that qualify under the Hong Kong
economy and promote financial inclusion among the younger Government’s SME Financing Guarantee Scheme. The branch with
generation. The bank sees encouraging take-up in Green plans to capitalise on the city's status as an international financial
Financing uptake among our retail customers through our Green centre and a financial hub for Mainland China, will leverage on the
affordable property financing in collaboration with developers extensive network of Hong Leong Bank in Malaysia, Singapore,
to promote the adoption of Green Certification applications. and other Southeast Asian countries to drive further business
Our community-based programmes such as HLB@School, have growth.
advocated financial literacy to the younger segment with 70% of
all Junior Savings accounts opened in Islamic accounts, signifying INSURANCE/TAKAFUL FINANCIAL &
the success of our inclusive approach.
OPERATIONAL REVIEW
Moving forward, HLISB is steadfast in promoting Islamic Finance
HLFG’s 100%-owned subsidiary, HLA Holdings Sdn Bhd (“HLAH”)
and will play our part to bridge and broaden access to Islamic
is the insurance holding company of our insurance division. HLAH
financial services for both individuals and business communities.
holds:
We aim to strengthen our position as a prominent player in the
Islamic finance industry and carry on making positive impacts on
• 70% equity interest in life insurance company Hong Leong
the communities that we serve.
Assurance Berhad (“HLA”);
• 65% equity interest in Family Takaful operator Hong Leong
Overseas Banking Operations MSIG Takaful Berhad (“HLMT”);
• 100% equity interest in Hong Kong general insurance company
Bank of Chengdu delivered a stellar profit growth and was a Hong Leong Insurance (Asia) Limited (“HLIA”);
significant contributor to HLB’s PBT with 25% improvement in its • 100% equity interest in Singapore general insurance company
share of profit of RM1,289 million. In part, this can be attributed HL Assurance Pte. Ltd. (“HLAS”); and
to HLB’s increased shareholding in BOCD resulting from a recent • 30% equity interest in general insurance company MSIG
convertible bond conversion ahead of other bond holders. Insurance (Malaysia) Bhd (“MSIG”).
BOCD aims to build on the bank’s growth momentum through
In FY2023, HLAH recorded a PBT of RM441 million or higher of These awards truly reflect HLA’s steadfast commitment to offer
12% y-o-y attributed to higher revenue from improvement innovative insurance solutions, provide comprehensive coverage
in investment income reported from positive mark-to-market and service excellence that are the catalysts in delivering best-in-
valuation gains on investments. class customer experience.
Life Insurance Family Takaful
HLA, as a life insurer, is the largest operating business within Our Family Takaful business, HLMT stayed on a growth trajectory
our insurance division contributing over 80% of HLAH’s total with 20% y-o-y increase in gross contribution to RM654 million in
insurance PBT. HLA’s PBT increased by 12.5% y-o-y to RM353 FY2023, outperforming the industry. The strong business growth
million in FY2023. Its gross premiums declined 2.2% y-o-y to was supported by a robust banca channel, network of affinity
RM3.1 billion while new business regular premiums (“NBRP”) partners and an enlarged agency distribution that has more than
dropped 17.3% y-o-y to RM530 million mainly due to the cautious 5,500 agents.
sentiments among customers and the impact from competitive
bank deposit rates. Consequently, the new business embedded As part of our efforts to strengthen the affinity partnerships,
value (“NBEV”) was lower by 10.9% y-o-y to RM178 million. In HLMT has introduced an online system for submission and claims
terms of embedded value (“EV”), HLA’s EV improved to RM3.8 to enhance the operational efficiency and deliver an improved
billion or 16.0% y-o-y in FY2023 underpinned by underwriting customer experience. Besides, HLMT has been implementing
of profitable new business and improvement in investment various efforts to reinforce its sustainability agenda into its
performance during the financial year. business, amongst others, HLMT has incorporated Environmental,
Social and Governance (“ESG”) factors into its investment policy,
The Investment-Linked segment sustained its growth, albeit at launched a new ESG investment-linked funds and embarked
a slower pace of 3% y-o-y as a result of stiff competition from on a new partnership with Tabung Haji to offer coverage to its
banks’ fixed deposits. The mix of Investment-linked premium to approximately 9 million depositors.
total gross premium improved from 75% to 79%. Our market
ranking in terms of new business for the Investment-Linked HLMT is committed to the implementation of Value Based
segment remained at No. 4 position as at 30 June 2023. In terms Intermediation for Takaful (VBiT) and will continue to support
of distribution, HLA continues to focus on building a productive Bank Negara Malaysia’s aspiration to make takaful coverage
and professional agency force while executing its bancassurance accessible to all by having diverse choices for different segments
by leveraging off the distribution network of its sister company of customers, including "digital first" solutions.
HLB’s wide network of branches. The agency channel accounted
for more than 70% of the total gross premiums contribution Overseas General Insurance
followed by the banca channel. Our agency force is also gradually
pivoting towards distributing more protection products with HLA’s Our overseas general insurance companies, namely HLAS in
protection and savings premium mix ratio increasing to 38:62 Singapore and HLIA in Hong Kong, operate a business focusing on
versus 24:76 in FY2022. HLA’s management expense ratio stood online distribution channels in their digital-led and data-driven
at 6.3% in FY2023, amongst the lowest in the industry, reflecting business model.
its continuing efforts in strategic cost management whilst
reinvesting into its digital transformation plans. HLA’s digital In FY2023, HLAS experienced a remarkable 41% y-o-y increase in
transformation, product re-positioning plans and multi-channel gross premiums, primarily driven by a surge in travel insurance
distribution will contribute to building long-term value creation demand following the reopening of national borders. This
for the franchise. growth momentum was fuelled by our direct digital initiatives
and strategic affinity partnerships. Notably, HLAS’ corporate
HLA’s Group Managing Director/ CEO has been awarded the Woman insurance segment also underwent an accelerated expansion in
Leader of the Year award at the 26th Asia Insurance Industry Awards line with its strategic distribution efforts and diversified portfolio
2022 while HLA itself is the proud winner of the Insurtech – Life strategy. Throughout, HLAS maintained a sustainable operational
Insurance at the Malaysia Technology Excellence Awards 2023. framework, underpinned by solid digital infrastructure that spans
both individual and corporate operations.
30 • CORPORATE
Likewise, HLIA achieved a noteworthy 20% y-o-y improvement y-o-y due to lower profit contributions from its key operating
in gross premiums following the resurgence of our travel subsidiaries HLIB and HLAM. The stockbroking division’s financial
insurance business, as border restrictions were lifted in Hong performance was affected by weaker Bursa market activity with
Kong in early 2023. HLIA has adeptly diversified its insurance traded value contraction of almost 26% y-o-y. The investment
distribution channels, effectively leveraging affinity partnerships banking division’s performance was impacted by the elevated
and intermediary collaborations to facilitate rapid growth in our interest rate which led to an escalation in funding costs and
customer base. a challenging underwriting environment. As for our fund
management business, the reduced earnings were mainly due
MSIG General Insurance to the contraction of assets under management in the money
market funds driven by the removal of tax exemption for this
MSIG Insurance (Malaysia), our general insurance associate, category of funds coupled with impact from competitive fixed
recorded lower profit contribution of -12.8% from RM78 million deposits interest rates.
to RM68 million due to higher net claims from economic
resumption, especially from motor segment returning to pre- HLCB had adopted a prudent approach in respect of the dividend
pandemic normalisation. payment and had declared a final dividend of 17.0 sen per share
for FY2023 which was 2.0 sen lower than last year. The total
MSIG Insurance (Malaysia) is also ranked No.2 based on gross capital ratio of HLCB’s key operating subsidiary, HLIB, remained
direct premium in the local general insurance industry, solidifying healthy at 46.0% as at 30 June 2023.
its position as one of the leading general insurers in Malaysia.
Investment Banking
Moving forward, MSIG Insurance (Malaysia) will continue to focus
on further digitalising its services, developing products in line The investment banking business of HLIB recorded a revenue
with market trends, growing strategic segments and exploring of RM53.4 million and a PBT of RM13.1 million in FY2023. The
new partnerships to equip the Company with sustainable long- Treasury & Markets business remained a key revenue generator,
term growth. contributing RM22.2 million or 41.7% to the investment banking
business's total revenue in FY2023. The escalation of funding cost
INVESTMENT BANKING FINANCIAL & has compressed net revenue earned by Treasury & Markets and
there was less opportunity to monetize gains in our fair value
OPERATIONAL REVIEW through other comprehensive income (“FVOCI”) investments in
a high interest rate climate. Nonetheless, the liquidity profile of
HLCB is an investment holding company for our investment
HLIB remained strong with a liquidity coverage ratio of 139.6%.
banking, stockbroking, and asset management business. HLCB’s
key operating subsidiary companies are 100%-owned Hong Leong The Equity Markets division faced headwinds stemming from
Investment Bank Berhad (“HLIB”), 100%-owned Hong Leong lower capital market activities as issuance sizes across initial
Asset Management Bhd (“HLAM”) and HLAM’s 100%-owned public offering (“IPO”) and secondary fundraising contracted by
Hong Leong Islamic Asset Management Sdn Bhd (“HLISAM”). HLIB 20.5% y-o-y that led to a decline in revenue by 25.0% y-o-y.
provides a full range of investment banking services encompassing During the financial year, HLIB successfully led and completed
Debt Markets, Equity Markets and Treasury & Markets, while its four (4) IPO exercises and sixteen (16) other corporate advisory
Stockbroking services are provided through the head office at exercises. The most notable transaction completed by the team
Menara Hong Leong, branches, and several regional hubs across was the RM4.5 billion disposal of concession highways for
Malaysia. HLAM and HLISAM are fund management, Islamic fund Gamuda Berhad to Amanat Lebuhraya Rakyat Berhad, where
management and unit trust companies offering and managing HLIB acted as the Principal Adviser. This transaction led to HLIB
a broad spectrum of investment solutions through equities, winning the “Best Domestic M&A Deal of the Year in Malaysia”
fixed income, money market and multi-assets for segregated in the 16th Annual Best Deal & Solution Awards 2022 organized
customised portfolios, unit trust funds and wholesale funds. by Alpha South East Asia, an institutional investment publication.
HLCB had a challenging year as its performance was impacted The Debt Markets division rebounded impressively achieving a
by weak investment sentiment and higher interest rates that robust y-o-y revenue growth of 67.3% in FY2023, largely due
resulted in increased funding costs and reduced liquidity for to our mandated pipeline from previous year. The debt markets
trading. Consequently, HLCB’s PBT of RM 61.4 million fell 36.8% team successfully completed thirteen (13) key transactions,
and was appointed as the Joint Principal Advisers, Joint Lead traded volume of RM4.1 billion in FY2023 as compared to RM6.9
Arranger and Joint Lead Managers in the issuance of RM5.5 billion in the previous financial year, mainly due to our customers’
billion Sustainability Sukuk Murabahah Programme issued by cautious stance in an uncertain investment environment.
Amanat Lebuhraya Rakyat Berhad to finance the acquisition
of four (4) highway concessionaries. The issuance of RM5.5 During the financial year, our Stockbroking business launched
billion Sustainability Sukuk Murabahah by Amanat Lebuhraya a fully digitalised account opening experience for our clients in
Rakyat Berhad, earned HLIB recognition with eight prestigious April 2023 that improved the turnaround time to onboard a client
awards accorded by various publications and Malaysian Rating from approximately five (5) working days to two (2) working
Corporation. These achievements reaffirm our team’s innovation days. In addition, we enhanced our share trading website with a
capability and product superiority in providing unrivalled value to single sign-on capability and upgraded our foreign trading mobile
our clients in the debt capital markets space. application with a better user interface that makes trading
simpler.
Looking ahead, the capital market landscape is anticipated
to remain challenging with limited large-scale infrastructure Moving forward, the team will focus on growing market share
projects in the pipeline. Our Debt Markets and Equity Markets and expanding our revenue base. We will enhance our client’s
divisions shall build upon their strengths in structuring and investment and trading experience through advance deployment
distribution capabilities to enhance HLIB’s competitiveness of technology, product innovation and plan ways to embed ESG
and respective market share. The teams will also place greater into our stockbroking products.
focus in growing HLIB’s presence in the ESG space and seek
opportunities to collaborate with clients in accelerating their Asset Management
transition towards sustainable practices. The Treasury & Markets
division shall pursue trading opportunities sensibly as we steer The unit trust and fund management business operated under
through a high funding costs environment that is expected to HLAM and its subsidiary, HLISAM recorded a PBT of RM10.2
stay elevated in the near term.
million, marked a reduction of 59.5% y-o-y in FY2023. The
weaker performance primarily stems from a 26.1% contraction in
Stockbroking AUM of Money Market Funds following the discontinuation of tax
exemption for this fund category. The competitive fixed deposits
The Stockbroking division of HLIB recorded revenue of RM90.7 interest rates have also contributed to rapid redemptions from
million and PBT of RM 29.4 million, a decline of 30.6% y-o-y. our Money Market Funds.
This financial performance was negatively affected by subdued
activity in Bursa Malaysia's market during the year, which On 9 January 2023, HLAM launched its second ESG fund, notably
registered a decline in daily average trading volume to RM2.0 its maiden Shariah-compliant ESG fund, the Hong Leong Global
billion from RM2.7 billion on a y-o-y basis. Shariah ESG Fund that is designed to yield medium to long-term
capital growth by investing in a globally diversified portfolio
Net Brokerage income reduced by 33.5% y-o-y to RM44.7 million of companies that prioritize ESG criteria in their investment
mainly due to lower trading volume from the retail segment processes. This product expands the accessibility of sustainable
but offset by higher participation in the institutional segment. investing to a wider spectrum of clients. During the financial
Retail participation in the overall Bursa Malaysia market shrank year, HLAM displayed its proven track record of delivering stellar
to 26.3% in FY2023 from 29.3% in the previous financial year,
fund performance, winning 20 individual awards at the Refinitiv
while institutional participation has grown from 30.7% to
Lipper Fund Awards Malaysia 2023 and Refinitiv Lipper Fund
35.0% in FY2023. The shift in market participation led to a slight
Awards Global Islamic 2023. These funds have recorded a total of
decrease in HLIB’s market share from 3.88% to 3.85% during
RM170.1 million increase in AUM y-o-y.
the financial year given that the retail segment remains the
primary contributor to HLIB’s net brokerage income with 66.6%
Moving forward, HLAM and HLISAM will be focusing on
contribution in FY2023. Correspondingly, the contribution of
executing new strategies to diversify the AUM base and drive
the institutional segment to HLIB’s net brokerage income has
the expansion of our distribution channels. We will deepen our
increased to 33.4%. Our retail foreign share trading business,
digital capabilities to support the business expansion, improve
that offers access to eight (8) foreign markets also saw a lower
operational efficiencies and enhance our customers’ investing
experience.
32 • CORPORATE
SUSTAINABILITY
At HLFG, we placed emphasis in managing Environmental, Social and Governance (“ESG”) and its associated risks under a Group-wide
approach. We have amplified our commitment to advancing the global sustainability agenda, embedding the principles and tenets
of sustainability deeply into our operations. During the year, HLFG reviewed our material sustainability matters and performed an in-
depth analysis of these material matters that are listed in our sustainability statement. Our operating companies have set in place
internal policies encompassing ESG considerations and sustainability best practices, that spans across our product and service offerings,
tax strategy and approaches, lending assessment frameworks, investment policies, and decision-making processes across all our
businesses. Details of our sustainability achievements are set out in our Sustainability Statement.
Our commitment to sustainability has been duly acknowledged, as HLFG and all its public-listed operating companies, HLB and HLCB,
are constituents of the FTSE4GOOD Bursa Malaysia (F4GBM) Index.
OUTLOOK
At the time of writing, Malaysia’s GDP growth is projected to stay modest in the region of 4.0% in 2023. A resilient domestic demand
is expected to cushion a softer external trade amidst sluggish global demand, geopolitical uncertainties, and spillover effects from a
slower-than-expected recovery of China’s economy. Nevertheless, we anticipate the domestic economy will continue to be a key driver
of economic growth into 2024 as inflationary pressures stabilise, supported by a robust labour market and gradual recovery in the
economies of our major trading partners, notably China.
Overall, we approach the new financial year with caution as the current operating environment warrants vigilance with interest rates
likely to remain higher for longer and the macroeconomics uncertainties of FY2023 persists into the new year. The Group shall guard
against emerging risks and manage our businesses prudently, advancing on multiple fronts whilst strengthening our foundations for
a digitalised and sustainable future.
ACKNOWLEDGEMENT
We would like to take this opportunity to express our gratitude to the Board of Directors for their support and guidance, the management,
colleagues, and members of staff throughout the HLFG Group for their dedication and commitment.
Our sincere appreciation also goes out to the regulators, government authorities, shareholders, customers, and business partners as
well as to the community we serve for their continued faith and confidence in Hong Leong Financial Group.
FURTHER INFORMATION
For further information on our subsidiary companies, please refer to:
• HLB’s FY2023 MD&A in their FY2023 annual report at www.hlb.com.my or www.bursamalaysia.com;

• HLAH and HLA’s financial statements at www.hla.com.my; and
• HLCB’s FY2023 MD&A in their FY2023 annual report at www.hlcap.com.my or www.bursamalaysia.com.
Sustainability
Statement
OUR SUSTAINABILITY APPROACH
ABOUT THIS STATEMENT
This sustainability statement covers progress made by Hong Leong Financial Group Berhad ("HLFG") for the financial year of 1 July 2022 to
30 June 2023 ("FY2023") towards addressing economic, environmental, social, and governance matters within our business and operations,
in line with HLFG's sustainability ambitions. The Report is guided by the material sustainability matters of HLFG and our operating entities
(“the Group”) and prepared with reference to the Global Reporting Initiative (“GRI”) 2021 Sustainability Reporting Standards and Bursa
Malaysia Securities Berhad Main Market Listing Requirements (“Bursa Malaysia”) for Sustainability Statements in Annual Reports.
REPORTING SCOPE AND BOUNDARIES
This report encompasses sustainability data collected from the key operating companies of the following Group entities with the
ensuing core businesses:
• Hong Leong Bank Berhad (“HLB”) – Commercial and Islamic banking;

• Hong Leong Capital Berhad (“HLCB”) – Investment banking and fund management; and
• HLA Holdings Sdn. Bhd. (“HLAH”)* – Life insurance and family takaful.
* The information disclosed relates to Highlights & Achievement of 2023, Climate Metrics & Targets and Addressing the Emission Imperative. The remaining information
relates to Hong Leong Assurance Berhad ("HLA").
34 • CORPORATE
Sustainability Statement
HIGHLIGHTS & ACHIEVEMENTS OF 2023
HLFG
Expanded reporting boundaries for GHG Scope 2 and Scope 3 >50% female representative in HLFG Board
emissions to include purchased cooling and employee commuting
HLB HLCB HLAH

Financed over RM390 Mandated with up to Adopted Robotic Process
million for battery electric RM1.4 billion programme Automation across
vehicles (“BEV”), hybrid limits for financing of business processes to
electric vehicles (“HEV”), renewable energy projects increase productivity and
and plug-in hybrid electric accuracy
vehicles (“PHEV”) Launched Hong Leong
Global Shariah ESG Fund Conducted HLA L.I.V.E Hour
Cumulatively approved (“HLGSESGF”) to increase to engage employees,
over RM13 billion for Green accessibility to sustainable covering trending topics
Mortgage & Affordable investing such as Mental Health
Property Financing Awareness
36% increase in green
Cumulatively approved bonds investment,
Reduced approximately
over RM3 billion for Solar, contributing to the
20% of carbon emissions
Bioenergy, Small Hydro & generation of hydropower
since base year FY2019
Any RE* projects
Appointed a Chief
Reduced approximately Sustainability Officer (“CSO”)
21% of Scope 1 & 2 carbon to lead the Sustainability
emissions since base year Department and drive
FY2019, ahead of the strategic sustainability
targeted reduction of 15% initiatives throughout HLCB
to 25% by the year 2026 group companies
HLFG, HLB and HLCB have been listed as a constituent of FTSE4Good Bursa Malaysia index, as a recognition of our
Group’s efforts in embracing sustainability
* Any RE consist of customers with facilities that is not concentrated on a single RE resource
OUR APPROACH TO SUSTAINABILITY guide our operating companies to enhance their ESG performance,
including actively working towards financial inclusivity, a low-
The Group has adopted a progressive approach to embedding carbon economy, and an empowering and future-ready workplace.
sustainability into our businesses. This is in line with our vision to
be an integrated financial services group that strives to consistently At HLFG, we are guided by the five Sustainability Pillars that serve
meet our customers’ needs. We foster strength and resilience across as the foundation for evaluating, monitoring, and developing
the entire Group as we grow our businesses responsibly while sustainability efforts across the Group's key operating companies.
conscientiously balancing environmental, social, and governance Our operating companies are empowered to integrate ESG
(“ESG”) considerations to create value for our stakeholders and the principles into their operations, lending practices, provision of
communities within which we operate. financial services and products, and investment framework, while
also facilitating transparent sustainability disclosures. By aligning
We achieve this through continuous technological innovation our overall business practices with ESG principles, we aim to create
and transformation, supported by a robust risk management a meaningful impact on the well-being of the society and the
framework. As an investment holding company, HLFG aims to environment, contributing to a more sustainable future.
Digital Workforce Socially Responsible Environmental Community

at the Core Readiness Business Management Investment
STAKEHOLDER MANAGEMENT
Acknowledging the interests of our diverse stakeholder groups is fundamental to our long-term success. Through continuous engagement with
our stakeholders via our operating companies, we strive to foster and enhance meaningful connections. We maintain valuable relationships with
stakeholders using diverse engagement channels, as outlined in the table below:
Stakeholder Engagement Channel Areas of Interest Section

Employees - Daily operations - Effective communication Workforce Readiness,
- Performance management - Professional development pg68
- Whistleblowing channels - Job security
- Corporate communications - Benefits and well-being
- Training and development - Transparency
Investors - Annual reports - Corporate governance Good Governance,
- Announcements - Financial performance pg40
- Financial reports - Regulatory compliance
- General meetings - Transparency
- Whistleblowing channels
- Briefings
- Meetings
Regulators and - Daily operations - Regulatory compliance Good Governance,
Authorities - Audits - Corporate governance pg40
- Meetings - Ethical business conduct
- Circulars
- Enforcement
- Reports
Clients - Daily operations - Client experience Driving Sustainable
- Social media - Value-added products and services Economic Growth,
- Corporate communications - Data privacy and cybersecurity pg58
- Corporate events/workshops - Ethical business conduct
Community - Daily operations - Ethical business conduct Driving Sustainable
- Social media - Transparency Economic Growth,
- Roadshows and events - Community investment pg58
- Corporate communications - Financial inclusion
- Corporate Social Responsibility events - Financial literacy
Vendors and - Procurement process - Fair procurement Good Governance,
Suppliers - Tender process - Transparent tender process pg40
- Outsourcing service provider due diligence - Ethical business conduct
review
- Proof of Concept engagement
Analysts and - Social media - Transparency Good Governance,
Media - Corporate website - Strategic communication pg40
- Media announcements
Associations - Meetings - Industry stewardship Good Governance,
- Corporate events - Regulatory compliance pg40
- Online correspondences
36 • CORPORATE
MATERIALITY
Engaging with our stakeholders helps us to recognise emerging sustainability risks and opportunities, prioritise our efforts, and create
long-lasting value for our organisation and the community. Through this, we are able to identify material sustainability topics that will
ensure our progress in providing meaningful impact to our stakeholders, in line with their evolving requirements. We undertake a
structured approach to identify the material topics, and conduct assessments and reviews to determine the relevance of these topics,
which process is carried out at least biennially across the Group.
In FY2023, the Group undertook a materiality assessment exercise, taking into account the diverse views of a broad range of
stakeholders across our operating entities, including the Board, senior management, employees, regulators, investors, customers,
media, vendors, and suppliers.
Approach in Determining Our Material Topics
Topic Identification Stakeholder Engagement Prioritisation & Validation
Identified key sustainability topics Captured the views and understanding Processed the inputs gathered to
through comprehensive review of ESG of the internal and external stakeholders produce our FY2023 Materiality Matrix,
standards and industry trends, backed of our operating entities, HLB, HLCB, and which was validated by the Senior
by deep understanding of our value HLA, on what matters to them through Management.
chain. online surveys and engagements.
HLFG’s materiality assessment approach encourages recognition and communication of the impact of sustainability topics on our
Group’s performance, as well as the impact of our business activities along the value chain on the community and environment.
The Group has identified 17 topics that are material to our operations, which have been tabled in the materiality matrix and further
explained in the following section.
3 4
e En
2 or Ma viro
h eC na nm
1 tt ge en 5
a la m t al
git en
Di t
Com
6
n e ss
Material
m
Sustainability Topics
i
unit
Read
17 7
y I nv
orce
e st m
8
kf
Wor
16
e nt
Socially Responsible 9
Business
15 14 13 12 11 10
Material Sustainability Topics
Digital at the Core Workforce Readiness 13. Fair Treatment of Financial Consumers
1. Digitalisation & Innovation 6. Talent Attraction, Development & Retention 14. Sustainable Supply Chain
2. Customer Experience 7. Diverse and Inclusive Workforce 15. Human & Labour Rights
3. Privacy, Data Protection & Cybersecurity 8. Creating a Fair and Nurturing Workplace
9. Fostering a Sustainability-Driven Culture Community Investment
Environmental Management 16. Supporting Social Enterprises and
4. Managing Our Operational Environmental Socially Responsible Business Communities
Footprint 10. Good Governance & Ethical Business 17. Financial Inclusion & Literacy
5. Building Climate Resilience Conduct
11. Sound Risk Management
12. ESG Integration into Financial Products
Legend: Digital at the Core Socially Responsible Business Environmental Management

Workforce Readiness Community Investment
8
10
11
Importance to Stakeholders
2
13
7 6
15
9
17
16 4
12
14
Importance to the Group

38 • CORPORATE
Digital at the Core
No. Material Matters Description
1 Digitalisation & Leveraging advanced data analytics and digital systems to develop innovative products aligned
Innovation with customers’ needs, and increase operational effectiveness to drive productivity, while
simultaneously increasing accessibility of our products.
2 Customer Experience Embedding a customer-centric culture throughout the organisation and undertaking initiatives
to enhance end-to-end customer experience and customer satisfaction; leading to higher
customer retention rates.
3 Privacy, Data Safeguarding employees’ and customers’ data from unauthorised access, cyber attacks, and
Protection & threats through responsible collection, handling, storage, and protection of personal and
Cybersecurity proprietary data.
Environmental Management
4 Managing Our Responsibly optimising resource efficiency to effectively manage the environmental footprint of
Operational our operations, especially in energy management, paper consumption, water consumption, and
Environmental greenhouse gas (“GHG”) emissions.
Footprint
5 Building Climate Embedding climate-related risks into our risk management and operational framework to
Resilience facilitate the transition towards a low-carbon economy, including reducing exposure to high-risk
sectors and supporting low-carbon solutions.
Workforce Readiness
6 Talent Attraction, Establishing a sustainable, high-quality talent stream, while also fostering a growth mindset
Development & in our employees to ensure their adaptability in the ever-evolving business and technological
Retention landscape.
7 Diverse and Inclusive Promoting and embracing a diverse and inclusive workplace, whereby all employees are
Workforce treated equally and without discrimination, thus encouraging productivity and innovation.
8 Creating a Fair and Creating an inclusive and supportive work environment which prioritises employee health and
Nurturing Workplace safety via effective policies, processes, and labour standards.
9 Fostering a Establishing a corporate culture that embraces and promotes sustainable practices, values, and
Sustainability-Driven behaviours throughout the organisation, including encouraging employee volunteerism.
Culture
Socially Responsible Business
10 Good Governance Committed to conducting our business and operations professionally, while adopting the
& Ethical Business highest standards of ethics, integrity, transparency, and accountability, in order to maintain
Conduct stakeholders’ trust in the organisation.
11 Sound Risk Upholding a strong compliance culture throughout the organisation to ensure adherence to
Management applicable laws, regulations, and standards, as well as preventing financial crimes including
money laundering, terrorism financing, fraud, corruption, and bribery.
Adopting a systematic and comprehensive risk management approach in identifying and

mitigating emerging risks to our business activities by investing in people, technology, policies,
and processes.
12 ESG Integration into Integrating ESG factors into our products and services including:
Financial Products - Issuance of green and sustainable finance (HLB);
- Investment practices (HLCB);
- Insurance processes (HLA)
13 Fair Treatment of Ensuring fair treatment of our customers throughout our operations by prioritising their financial
Financial Consumers needs and risk appetite, as well as providing transparent, accurate, and comprehensive
information about our products and services.
14 Sustainable Supply Upholding sustainability procurement principles across the supply chain via robust supplier
Chain policies, assessment, and engagement practices, while also encouraging supplier diversity to
include local businesses.
15 Human & Labour Implementing policies to ensure the protection and respect of human rights throughout our
Rights value chain and business operations, including prevention of human rights violations.
Community Investment
16 Supporting Social Forming partnerships with social enterprises for community empowerment programmes as a
Enterprises and way of creating long-term social impact for underserved communities across our operations.
Communities
17 Financial Inclusion & Empowering individuals and businesses to improve their financial well-being by promoting
Literacy financial literacy and facilitating accessibility of affordable financial services to all segments of
society.
For additional information on HLB’s material sustainability topics, please refer to the HLB SR2023
For additional information on HLCB’s material sustainability topics, please refer to the HLCB AR2023
40 • CORPORATE
GOOD GOVERNANCE
DRIVING SUCCESS THROUGH STRATEGIC LEADERSHIP
Corporate Governance
Robust corporate governance and clear leadership form the basis for our organisation’s success, leading the way towards achieving the
Group’s sustainability goals. With a commitment to ensuring an effective governance framework, our Board of Directors (“Board”) set
the tone at the top, maintaining oversight of management and the development and execution of our overall sustainability strategy.
HLFG Board
Group Board
Board Audit and
Nomination Committee Remuneration Information and
Risk Management
(“NC”) Committee (“RC”) Technology Committee
Committee (“BARMC”)
(“GBITC”)
The Board is supported by BARMC, NC, RC, and GBITC. Together with Senior Management, the Board oversees compliance with the
regulations on Anti-Bribery and Corruption (“ABC”), Anti-Money Laundering (“AML”), whistleblowing, and other regulatory requirements.
In order to ensure relevance and regulatory compliance, these policies and their respective standard operating procedures (“SOPs”)
are reviewed annually.
Governing Body Roles and Responsibilities
Establishes a sound governance structure for the implementation of sustainability efforts and practices
Board of Directors
in business operations, to ensure that sustainability is embedded in business strategies.
Comprising members of the Board, the BARMC has been set up to oversee the implementation of
Board Audit and
the governance framework and internal control framework and policies by the management of the
Risk Management
organisation and that risk management is being managed effectively. They, in turn, report all material
Committee (“BARMC”)
governance, internal control, and risk management activities to the Board.
Jointly supports the Boards of HLFG, Hong Leong Investment Bank Berhad ("HLIB"), HLA and Hong Leong
Group Board
MSIG Takaful Berhad ("HLMT") to oversee technology and cybersecurity issues, foster discussions to
Information
harmonise digital development practices, ensure robust risk assessments for important technology
and Technology
applications, and oversee management's compliance with BNM Risk Management in Technology
Committee (“GBITC”)
("RMiT") Policy.
Supports the Board in matters of appointments, composition, performance assessment, and skills
evaluation for the Board, senior management, and company secretary. This includes setting criteria
Nomination
for appointments, reviewing appointments and removals, assessing overall Board composition
Committee (“NC”)
and effectiveness. The committee also reviews the performance of the BARMC, manages senior
management succession planning and evaluations, and ensures the Board's ongoing training.
Supports the Board and reviews the structure and guidelines for remuneration concerning Directors,
Remuneration Chief Executive Officer, senior management officers, and material risk-takers; evaluating executive
Committee (“RC”) directors' and the Chief Executive Officer's remuneration packages for Board approval; and assessing for
Board approval the remuneration of key senior management officers and other material risk-takers.
Sustainability Governance
Establishing a top-down approach focused on sustainable development and growth, the roles and responsibilities of the Board, Senior
Management, and Sustainability Team are defined within the organisation. With a streamlined direction and leadership from the top,
we are able to oversee sustainability initiatives and monitor efforts and progress in addressing our material sustainability matters
across the Group.
HLFG’s Board of Directors
Senior Management
Sustainability Team
42 • CORPORATE
Board and Senior Management Roles and Responsibilities
HLFG Board is committed to ensuring sustainable practices are progressively embedded across the organisation to manage sustainability
matters effectively. The Board provides oversight on all sustainability governance matters and is supported by Senior Management,
namely our President & Chief Executive Officer, with the support of the Group Chief Financial Officer, who is responsible for driving
the implementation of our sustainability strategy and ensuring that our objectives are met. We are currently outlining the roles and
responsibilities of our Sustainability Committee, which is expected to be approved and adopted by FY2024.
Governing Body Roles and Responsibilities
To establish a sound governance structure for the implementation of sustainability efforts and practices in
Board of Directors
business operations, to ensure that sustainability is embedded in business operations.
President & Chief

Executive Officer
To drive the implementation of our sustainability strategy and ensuring that sustainability objectives are
met.
Group Chief
Financial Officer
The Boards across our operating entities are cognisant of their duties and responsibilities in addressing sustainability for the wider
Group, with sustainability governance structures implemented for each entity.
ESG Capacity Building for the Board
Our Board, which comprises individuals with diverse skills and backgrounds, is responsible for overseeing critical aspects of our
company, including ESG-related matters. We seek to ensure that we operate as a team, leveraging our diverse strengths and expertise
that contribute to achieving the strategic ESG priorities of the Group. In line with this, our Boards across the Group are equipped with
a wide range of skill sets and expertise, including banking and/or financial services, insurance, technology, corporate governance, risk
management or compliance, sustainability, financial acumen, and international business experience.
We also strive to provide ongoing board training on sustainability-related topics to ensure the Boards remain well-equipped to
integrate ESG considerations into the respective organisation’s overall strategy, decision-making processes, and risk management. With
this approach, we endeavour to ensure transparency, integrity, and sustainable decision-making across all aspects of our operations.
Diversity & Inclusivity Across the Board
Maintaining a diverse Board is in line with our focus on encouraging diversity and inclusivity at every level of our organisation. All of
our directors are nominated and appointed fairly, with no discrimination made based on gender, race, or religion, with HLB and HLCB
further establishing their respective Board Diversity Policies. By prioritising an inclusive culture, we are able to maximise the strengths
of a diverse workforce, creating a lasting and meaningful impact on our organisation in a rapidly changing business landscape.
Board Independence in FY2023 Board Gender Diversity in FY2023
2 3
7 7
Directors in Directors in
HLFG HLFG
5 4
Independent Non-Independent Male Female
BOARD DIVERSITY ACROSS OUR OPERATING ENTITIES
Board Independence in FY2023
4 4 3
3
7 7 5
Directors in Directors in Directors in
HLA HLB HLCB
3
2
Independent Non-Independent
Board Gender Diversity in FY2023
3 4 4 2
7 7 5
Directors in Directors in Directors in
HLA HLB HLCB
3
3
Male Female
44 • CORPORATE
ESG Risk Governance
Guided by the Sustainability Risk Governance Framework, which is aligned to the Group’s overall Risk Management Framework, our
ESG risk management governance structure promotes active involvement of all parties in the ESG risk management process to ensure
a uniform view of risk across the organisation. It also ensures accountability while facilitating an appropriate level of independence
and segregation of duties between all parties involved in the process.
All operating companies across the Group has incorporated ESG and sustainability factors into their operations to promote
positive effects on the communities they operate in. This involves a structured approach towards identifying, evaluating, quantifying,
monitoring, mitigating, and reporting ESG risks. Despite the inherent risks associated with ESG, the operating companies have
introduced strategies to minimise and adapt to these risks, enabling the Group to improve resource efficiencies, adopt low-emission
energy sources, develop new green products and services, access new markets, and further strengthen its resiliency against risks in
general.
Recognising the urgency for financial institutions to accelerate efforts to manage climate-related risks, the operating companies have
established ESG-related strategies, practices, processes, and procedures to ensure it is able to continue to deliver long-term value to
its stakeholders in tandem with ESG-related developments and aspirations.
Embedding Sustainability into Our Organisational Philosophy
The Group is cognisant of the role we play in driving the sustainability initiative for the economy. We are committed to advocating for
sustainable development and integration, not only to our external stakeholders, but also internally. To that end, our organisational
philosophy has taken measures to facilitate smooth sustainability integration, driving granularity in the implementation and integration
of sustainability considerations across the organisation.
Sound Risk Management
We have made steady progress in embedding ESG considerations, through our interactions with stakeholders, into daily business
practices, products, and services. This ideal drives our sustainability progress and aspirations, enforcing our dedication to promote
sustainability within our business value chains and network of stakeholders across our operating businesses.
With that in mind, our operating businesses, through their respective Risk Management Frameworks, have implemented comprehensive
mitigation measures to address the inherent ESG risks within their operations. These include policies and action plans to manage the
following risks:
Operational IT and Compliance

Credit Risk Market Risk Liquidity Risk
Risk Cyber Risk Risk
Environmental, Social
Bribery and Pandemic-Related Business
and Governance Shariah Risk
Corruption Risk Risk Continuity Risk
(ESG) Risk
ETHICAL BUSINESS PRACTICES
Conducting business in a sound and responsible manner is fundamental to the organisation, increasing the need for robust internal
controls and rigorous risk management procedures. To that end, the Group works assiduously, ensuring our principles and ambitions
continue to drive the organisation towards providing positive lasting value for all of our stakeholders by building trusted partnerships
and ensuring fairness and integrity.
Upholding Compliance and Integrity
HLFG is committed to upholding the highest standards of business conduct across the Group, ensuring the safety and security of our
customers. A robust suite of policies, procedures, and controls are set in place to prevent unlawful activities from taking place, including
money laundering, terrorism financing, bribery and corruption, among others. The BARMC oversees and monitors issues relating to the
Group’s regulatory compliance. Guided by the Group’s Compliance Framework, the Group looks to build a strong compliance culture for
all employees to not only understand and manage compliance risk, but also comply with evolving legal and regulatory requirements.
The Group remains steadfast in our efforts to provide and maintain high standards of conduct in all our business dealings across the
Group. We endeavour to ensure that all business activities are carried out with the highest levels of ethics and integrity.
As part of our approach towards good corporate governance, all our operating companies have implemented key compliance policies,
including the Code of Conduct and Ethics, Anti-Bribery and Corruption, and Anti-Money Laundering, Countering Financing of Terrorism
and Targeted Financial Sanctions (“AML/CFT & TFS”), Personal Data Protection, and Whistleblowing policies to ensure responsible
business conduct is continuously upheld. We proactively engage and train our employees on a regular basis with an emphasis on
proper and ethical behaviour among our workforce. Employees are encouraged to raise their concerns about any improper conduct
through the channels established by the Whistleblowing Policy.
Anti-Money Laundering and Counter

Anti-Bribery & Corruption (ABC) Fraud
Financing of Terrorism (AML/CFT)
Data Privacy and Protection Fair Treatment Human Rights
For additional information on our Compliance policies across the Group, please refer to our page at http://www.hlfg.com.my/about-us/codes-and-policies
For additional information on HLB’s compliance policies, please refer to the HLB SR2023
For additional information on HLCB’s compliance policies, please refer to the HLCB AR2023
46 • CORPORATE
PRACTISING RESPONSIBLE PROCUREMENT
Vendors and suppliers seek transparency in our procurement process and fairness in our business conduct. To achieve this, we
adhere to our Procurement/Tender policy principles and procedures, which ensures proper governance and fair procurement,
including due diligence, conflict of interest management, and approval requirements, across our operating entities.
We are committed to reducing the environmental impact of our operations throughout the value chain. To that end, HLB, HLCB, and
HLFG have integrated ESG considerations in supplier and vendor selections for their procurement and outsourcing processes, while
HLA will be looking to roll out similar initiatives moving forward.
Aligning with the Group's Anti-Bribery and Corruption ("ABC") Policy, we expect suppliers and vendors to adhere to our zero-
tolerance stance against bribery and corruption. To ensure supplier integrity, we conduct due diligence, including background checks
and document verification, before entering into formal relationships with vendors and periodically thereafter.
CLIMATE RESILIENCE ACROSS THE GROUP
We are mitigating climate-related risks by working towards enhancing our management of climate-related risks and opportunities,
as well as improving our climate-related disclosures leveraging guidance from BNM’s Task Force on Climate-related Financial
Disclosures (“TCFD”) Application Guide for Malaysian Financial Institutions, in line with Bursa Malaysia’s Sustainability Reporting
Guide and in compliance with BNM’s Climate Change and Principle-based Taxonomy. We have conducted various exercises to
identify and disclose our climate-related risks and opportunities at the operating level, with further details reported by individual
operating companies around four thematic areas: Governance, Strategy, Risk Management, and Metrics and Targets.
Climate Governance
We are aware that incorporating climate risk considerations into our policies forms the foundation for the identification and
management of climate-related risks across the Group. In an effort to create long-term value for our stakeholders, prioritising the
strengthening of climate risk management remains key to the organisation.
In order to ensure that members of the Board not only have the necessary skills and knowledge on climate change, but are also
kept up-to-date on the latest climate issues, our Boards across our operating entities attended a variety of climate-related training
sessions in 2023, including training on climate-related risks, climate governance, and the integration of climate considerations into
business.
Climate Strategy
We continue to disclose our approach to managing climate risks and opportunities, aligned with the TCFD recommendations.
Our operating entities have taken guidance from JC3’s TCFD Application Guide for Malaysian Financial Institutions in developing
climate-related disclosures as they look to drive the integration of climate considerations into their daily operations.
As our operating businesses operate at varying levels, individual climate strategies of these entities are denoted below:
Operating Entities Climate Strategy
• Established a Vendor Sustainability Self-Assessment to ensure that climate-related aspects are considered
in the vendor risk assessment
• Developed and implemented the Green Bond Framework, where proceeds from the issuance of green
bonds are used to finance or refinance new or existing green assets/projects
• Introduced the BCB ESG Assessment Framework and Policy, an inclusionary approach to assist our customers
in transitioning to climate-resilient business operations, and better manage the ESG risks of loan/financing
portfolios
HLB
• Implemented the Wealth Management ESG Framework, to consider ESG risks in the wealth management
products such as mutual funds, unit trusts, bonds, and equity products
• Initiated the Developer End Financing Framework to drive the integration of ESG evaluation into decision-
making processes for panel developers
• Rolled out the Environmental Policy on Energy, Water, and Waste Management to promote efficient
utilisation of energy and water resources while effectively managing waste without compromising safety,
comfort, and reliability of the Bank’s physical operations
• Established a time-bound implementation plan to address the requirements of BNM's Climate Risk
Management and Scenario Analysis policy document in the short and medium term. Climate scenarios are
progressively embedded into the time-bound implementation plan
• Established a Sustainability Framework in July 2022 that strategically guides HLCB's business, including the
incorporation of climate-related considerations
HLCB • Launched Hong Leong Global ESG Fund (“HLGESGF”) and Hong Leong Global Shariah ESG Fund (“HLGSESGF”)
which emphasise ESG investments
• Progressively embedding ESG requirements into investment decisions including steady growth in green
bond portfolio and investment in green energy projects
• Conducting a comprehensive and holistic climate-related risk and opportunity assessment to understand
the impact, implication and methods for managing risks and opportunities
• Continue to enhance sustainability practices and progressively embed ESG in every aspect of HLA's
business operations and processes
• Integrated ESG considerations into Employee Benefits Department's existing clients, to identify and classify
HLA existing clients based on their environmental and social risk scoring
• Taken progressive measures to reduce water usage and electricity consumption in HLA's nationwide
operations
• Implemented initiatives to reduce GHG emissions through waste and e-waste recycling
48 • CORPORATE
Climate Risk Management
The Group views climate change as an emerging risk that could impact our operations. As such, we recognise that physical, transition,
and liability risks may transfer through microeconomic and macroeconomic perspectives and subsequently impact HLFG and our
operating companies' performance. These risks may potentially have both financial and non-financial impacts on our business and
portfolio exposure.
Our operating entity, HLB categorises climate-associated risks based on 5-year intervals, aligning with the Paris Agreement's stipulation
that each member is required to communicate their Nationally Determined Contributions every 5 years.
Climate Metrics & Targets
We are committed to driving change within and throughout our businesses. In support of this, our operating company, HLB, has
committed to achieving a carbon neutral position for their own emissions by 2030, and a Net Zero Carbon equivalent position by 2050.
Our operating entities continue to enhance data integrity and quality in this regard, and our performance for the year is described
below.
Operating Entities Metrics & Targets
• Successfully reduced about 21% of operational emissions (Scope 1 and 2) since FY2019
• Enhanced Scope 3 boundaries to include employee commuting and downstream leased assets as well as
HLB
operational and business travel emissions from branches in Hong Kong and Singapore
• Completed retrofitting of LED light fittings in 21 HLB-owned branches
• Began measuring and monitoring GHG emissions under Category 7 - employee commuting for
HLCB
Scope 3, in addition to Scope 1, Scope 2, and Scope 3 business travel
• HLAH's GHG emissions encompass HLA and HLMT premises across Malaysia including headquarters and
branches
HLAH
• Began measuring and monitoring GHG emissions under Category 7 - employee commuting for
Scope 3, in addition to Scope 1, Scope 2, and Scope 3 business travel
RESPONDING TO CYBER SECURITY RISKS
As the industry landscape increasingly shifts towards digital platforms and online financial services channels, the Group recognises the
importance of strengthening the robustness of our cyber security controls.
Operating Entities Enhancing Cyber Security
• The Board Information and Technology Committee (“BITC”) jointly supports the Boards of HLB and Hong
Leong Islamic Bank Berhad (“HLISB”) in overseeing technology and cyber security-related matters
• Board policies on Technology Risk Management, Cyber Resilience, Data Management, Data Protection and
HLB
Customer Secrecy
• Multi-layered security implementations that safeguard the integrity of our systems and our customers’
information
• Group Board Information and Technology Committee ("GBITC") jointly supports the Board of HLIB in
overseeing technology and cyber security-related matters
• Stringent compliance, through policies and controls, with requirements in the Financial Services Act 2013
(“FSA”), Capital Markets and Services Act 2007 (“CMSA”), Personal Data Protection Act 2010 (“PDPA”), as
well as other regulations issued by BNM, SC, and Bursa Malaysia
HLCB
• Red Team Exercise: an attack simulation designed to measure the Group’s ability to withstand real-life
threats
• Cyber Drill Exercise to simulate cyberattacks, information security incidents and disruptions
• Tipping Point Intrusion Prevention System implemented, safeguarding computer systems from vulnerability
attacks and web application vulnerabilities
• GBITC jointly supports the Board of HLA in overseeing technology and cyber security-related matters
HLA • Technology Risk Management Framework to address risks that may arise from failures or breaches of IT
systems and/or applications
Operating Entities Promoting Cyber Awareness Culture
• Mandatory e-learning on Cyber Security and Cyber Risk Management

• Thematic Huddles on Cyber Risk Awareness
HLB • Cyber Leaders Training to give a practical overview of cyber handling for managers to guide their team
• Roll out cyber comics series to promote cyber risk awareness with a virtual cyber security ambassador
• Quarterly Cyber Security and Risk Awareness Videos
• Cybersecurity Threat Modelling briefing

• Materials on cybersecurity awareness communicated via email
HLCB • Gamification of learning on malware, mobile security, and phishing through videos and crossword puzzles
• Training via video and assessment relating to password security
• Cybersecurity awareness pop-up reminder appears on staff PC or laptop upon login on a bi-weekly basis
• Cyber Resilience Framework to strengthen our technological resilience against operational disruptions and
ensure all our business units take collective responsibility over cyber risk management
• Endpoint Detection and Response providing protection against ransomware and malware while also
HLA
facilitating threat hunting and incident response
• Periodic cyber security and risk newsletters that cover various topics relevant to all staff in educational and
comics form to provide bite-sized and casual reading
50 • CORPORATE
TRANSITIONING TO A LOW-CARBON ECONOMY
OUR SUSTAINABILITY IMPERATIVES
As a responsible financial holding company, HLFG is aware of the potential environmental issues that our operating companies may
have an impact on. To that end, we strive to minimise our environmental impact across our operating companies, which includes
tracking our carbon footprint. We track our year-on-year performance against our baseline to identify areas for further improvement.
Our cause is furthered by our operating companies expanding the ability to provide financing solutions for greener investments and
better strategies in managing our carbon footprint.
We have taken a leap forward in our sustainability journey as we enhance measuring and monitoring Scope 1 and Scope 2 GHG emissions
for operations, as well as Scope 3 business travel and employee commuting emissions. We also currently track key environmental
metrics, including electricity and paper consumption, which are linked to our impact on climate change.
Sustainability Considerations at Our Operating Entities
Our sustainability considerations are guided by our outlined targets and goals, defining the direction of sustainability integration across
the Group. The Group’s business operations are committed to mitigating the adverse impacts in the form of environmental degradation
through climate change. This ideology is reflected across our operating companies’ ambitions and goals.
Set medium term

Set long-term
Set short term target of
Identified target of
target of Net Zero Emission
baseline year Net Zero
15% to 25% reduction for our operational
which is GHG Emission
of GHG Scope 1 and 2 emissions -
FY2019 Scope 1, 2, and 3
emissions by 2026 GHG Scope 1 and 2
by 2050
by 2030
To this end, HLB has approached the finalisation stage of the Mangrove restoration project, in FY2023, at which they are expected to
capture and store carbon through 50,000 mangrove trees. The initiative, in collaboration with MNS, is part of the Bank’s commitment to
mitigate the adverse impacts of climate change and reduce its own operations’ carbon footprint. This is estimated to be achieved through
an average of more than 1,200 tonnes of CO2 equivalent annually over the next 20 years.
HLB’s Green Financing Solutions
INTRODUCED GREEN DEBT FINANCING IN FY2022
Existing Financing Schemes
Enabling Access to Cleaner Promoting Green Supporting Green

Energy with Renewable Transportation via Developments via
Energy Financing Green Car Financing Developer End Financing
To achieve our Net Zero goal, we have adopted a multifaceted approach that encompasses various aspects of our business. This
includes the provision of green debt financing through financing access to renewable energy, green transportation, and supporting
green developments.
52 • CORPORATE
HONG LEONG CAPITAL BERHAD
Laid out a time-bound implementation Taken steps to begin the journey

Took a step forward by expanding its
plan to align with BNM’s Climate Risk towards quantifying climate-related
Scope 3 emissions reporting to include
Management and Scenario Analysis risks as part of its Semi-Annual Stress
employee commuting.
("CRMSA") policy document. Test.
Taken guidance from BNM’s TCFD Application Guide, Bursa

Malaysia’s Sustainability Reporting Guide and BNM’s Climate
Change and Principle-based Taxonomy ("CCPT"), to enhance Introduced the HLGSESGF to provide green and sustainable
its approach to climate-related disclosures around the four financing solution to a broader client base.
thematic areas of Governance, Strategy, Risk Management
and Metrics & Targets.
In line with HLCB’s endavour to play a crucial role in establishing climate-conscious practices and providing climate friendly financial
solutions, HLCB has laid out a time-bound implementation plan, aligning with BNM's CRMSA policy document. In addition, they are
progressively heading to further alignment by beginning the journey to quantifying climate-related risks and expanding their Scope
3 emissions reporting.
HLCB is also enhancing their climate-related disclosures with guidance and reference to regulatory standards and frameworks. Moreover,
HLCB is expanding their range of sustainable products to integrate Shariah-compliant sustainable products, providing sustainable
financing access to a broader client base through the HLGSESGF.
BNM’s Exposure Draft on Climate Sustainability Committee Raising Competencies

Risk Management and Scenario Newly formed Sustainability HLA and HLMT have implemented an
Analysis Committees in HLA and HLMT ongoing training programme designed
HLA and HLMT have completed the gap will provide support to the Board to enhance the ESG awareness of our
analysis of the exposure draft together in undertaking its oversight Board, Senior Management, and staff,
with a high-level Implementation responsibilities relating to while progressively building their
Roadmap. sustainability and climate risks. knowledge on climate-related risks.
HLA has undertaken several initiatives during FY2023 which underscore their efforts to manage climate-related risks effectively.
To that end, HLA has set out on their sustainability journey based on their high-level Implementation Roadmap with guidance from
BNM's Exposure Draft on CRMSA. Further driving the cause, a Sustainability Committee has been formed, acting as the oversight on
their sustainability journey. This comes together with internal capacity building seen through the ESG awareness training programme
for their Board, Senior Management, and staff.
Addressing the Emissions Imperative
We are working towards improving how we address climate-related risks and opportunities while improving the quality and expanding
the boundaries of our climate disclosures, aligning better with BNM’s TCFD policy document. The assessment of our carbon footprint
across all of our operating companies is a crucial effort to identify and improve our operational impact on the environment.
Group Emissions* (tCO2e) Scope 1 Scope 2 Scope 3
HLFG Total GHG Emissions

FY2023 14 58 31 103
FY2022 14 60 27 101
FY2021 16 54 27 97
HLB** Total GHG Emissions

FY2023 122 27,423 12,216 39,761
FY2022 91 28,298 9,215 37,604
FY2021 141 30,154 7,580 37,875
HLCB Total GHG Emissions

FY2023 35 662 719 1,416
FY2022 28 718 419 1,165
FY2021 32 743 194 969
HLAH Total GHG Emissions

FY2023 63 4,682 1,335 6,080
FY2022 49 3,810 885 4,744
FY2021 43 4,139 901 5,083
The Group (consolidated) Total GHG Emissions

FY2023 234 32,825 14,301 47,360
FY2022 182 32,886 10,546 43,614
FY2021 232 35,090 8,702 44,024
* Revision in GHG emissions figures is due to expansion of scope and boundaries

** HLB's GHG emissions covers only the Malaysian operations
54 • CORPORATE
SCOPE AND BOUNDARIES OF GHG EMISSIONS REPORTING
The Group has taken a phased approach to address the need for enhanced carbon footprint disclosures, taking into account data
readiness and limitations. At present, the reporting boundaries for GHG emissions are Scope 1, Scope 2, and business travel and
employee commuting under Scope 3. HLFG has expanded their own Scope 2 emissions calculations to include purchased cooling while
HLB has expanded their boundaries to include downstream leased assets under their Scope 3 reporting.
Scope 1 Direct GHG emissions that encompass:

- Stationary Combustion
- Mobile Combustion
- Fugitive Emission
Scope 2 - Indirect GHG emissions from the generation of purchased electricity
- Purchased cooling
Scope 3 Other indirect GHG emissions:
- Business Travel
- Employee commute
Our measurement and reporting of greenhouse gas emissions are in accordance with the GHG Protocol: A Corporate Accounting and
Reporting Standard, Intergovernmental Panel on Climate Change (IPCC) Guidelines for National Greenhouse Gas Inventories, and using
relevant local emissions factors where applicable.
HLB in FY2023
HLB’s carbon footprint saw a slight increase in their total GHG emissions in FY2023, a 5.7% increase to 39,761 tCO2e from
37,604 tCO2e in the previous year. The marginal increase in total emissions is attributed to the expansion of the Bank’s Scope 3
boundaries which saw the inclusion of employee commute and downstream leased assets as well as the inclusion of operational
and business travel emissions from branches in Singapore and Hong Kong. HLB is determined to further enhance the climate
disclosures, to achieve a more reliable accounting and reporting of GHG emissions.
HLCB in FY2023
HLCB’s GHG emissions disclosure is systematically documented in terms of scopes (Scope 1, Scope 2, and Scope 3) from FY2021 to
FY2023, covering operations at their main offices, Menara Hong Leong and Plaza Zurich, three HLIB branches, four HLAM branches,
as well as six hubs across different states. HLCB recorded a total of 1,416 tCO2e for FY2023, reflecting an increase from the previous
year. This can be primarily attributed to the inclusion of employee commuting in the calculation of Scope 3 emissions, driven
by a higher number of staff resuming work in office. HLCB is driven to be guided by the goals outlined in their Sustainability
Framework, propelling them to persistently oversee, assess, and enhance their GHG reporting.
HLAH in FY2023
HLAH's GHG emissions encompass HLA and HLMT premises across Malaysia including headquarters and branches.
Both absolute and intensity emissions in FY2022 and FY2023 saw an increase as employee and business travel has resumed to
pre-COVID19 condition.
A HOLISTIC APPROACH TOWARDS REDUCING OUR ENVIRONMENTAL FOOTPRINT
Our Environmental Progress
We recognise the importance and significance of resource management to progressively and efficiently reduce our environmental
footprint. This encompasses effective identification and management of resource consumption with no compromise on business
operations or productivity. Tackling effective resource management requires sustainability awareness from our stakeholders to drive
our efforts towards sustainable changes within our daily operations. We identify and monitor key resource consumption metrics to
track indicators material to us, which subsequently help strategise our management and ultimately reduce emissions and consumption
across the Group.
At HLFG, we strive to make a concerted effort in ensuring our resource management is met with initiatives that are in line with our
environmental goals. This includes greening our buildings, paper consumption management, and water consumption management.
GREENING OUR BUILDINGS
The Group has made conscious efforts to integrate sustainability into our daily operations. Extending initiatives to enhance resource
efficiency, the operating companies under the Group have implemented measures to ensure energy savings and efficient resource
management in our day-to-day business operations. In FY2023, HLA installed larger-scale solar PV panels for Tower B, PJ City, which is
planned to be operational in early FY2024. In addition, the operating locations of HLA has also been retrofitted with LED light tubes while
our buildings’ Chiller Starter System has been upgraded to regulate energy consumption. This, paired with the expansion of our energy
data inventory, has led to a granular understanding of our operational consumption across the Group.
Annual Electricity Consumption (kWh)

The Group
FY2021 FY2022 FY2023
43,810,427 40,858,116 39,549,465
FY2023
HLB* HLCB HLA HLFG
36,886,512 847,788 1,738,222 76,943
FY2022
HLB* HLCB HLA HLFG
38,202,545 919,822 1,662,345 73,404
FY2021
HLB* HLCB HLA HLFG
41,036,503 939,240 1,765,422 69,262
* HLB's Annual Electricity Consumption covers only Malaysian operations
56 • CORPORATE
WATER CONSUMPTION
Ongoing efforts include metrics tracking of water consumption and management across and the considerations of HLA to adopt
rainwater harvesting. The Group is intent on reducing the usage of water in our operations without compromising the safety, comfort,
and reliability of the Group’s physical operations.
Annual Water Consumption (m3)
The Group
FY2021 FY2022 FY2023
91,463 73,849 86,700
FY2023**
HLB* HLCB HLA HLFG
71,095 1,763 13,470 372
FY2022
HLB* HLCB HLA HLFG
61,192 2,109 10,220 328
FY2021
HLB* HLCB HLA HLFG
75,578 1,649 13,950 286
* HLB's Annual Water Consumption covers only Malaysian operations
** The increased water consumption for HLB, HLA, and HLFG from FY2022 to FY2023 was due to the normalised movement of people coming back to work post pandemic
PAPER CONSUMPTION
The Group is cognisant of the need for a reduction in the usage of paper, as it is a material resource in the operations of financial
institutions. This is achieved through streamlining of operations and the adoption and integration of digital innovation to reduce
the need for paper consumption. The operating companies have begun adopting the use of e-policies, statements, and other paper
trails as a byproduct of the use of financial services. These initiatives are aimed at reducing the total weight of paper used across the
operating companies, which would reduce operating costs.
Paper Consumption
FY2023
HLB* HLCB HLA HLFG
78,953 reams 6,818 kg 5,907 kg 328 kg
FY2022
HLB* HLCB HLA HLFG
71,121 reams 9,697 kg 5,467 kg 492 kg
FY2021
HLB* HLCB HLA HLFG
108,796 reams 10,496 kg 5,942 kg 269 kg
* HLB's Paper Consumption covers only Malaysian operations and is tracked through Total Office Paper Purchased (in reams).
While paper is an integral resource to financial institutions, HLB is aware of the need for better management of this precious resource.
To that end, HLB is active in their recycling initiative, recording 17,686kg of paper recycled in FY2023 for their Hong Leong Tower and PJC
Tower A buildings. HLA has also significantly increased their paper recycling, with 1,783kg of paper recycled in FY2023, an 80% increase
as compared to the previous financial year, which recorded a total of 988kg.
E-WASTE MANAGEMENT
The growing integration of digitalisation into the Group’s business operations has a direct correlation with the usage of digital technologies.
As a result, the need for e-waste management has increased in importance and the Group maintains effective handling mechanisms for the
management of e-waste including recycling programmes. HLB circulated posters and infographics and conducted an e-waste recycling drive
during their sustainability month from March to April in FY2023. HLCB engaged with HP and expanded their lease agreement to encompass
recycling services in order to ensure proper collection, recycling, and disposal of e-waste, particularly toners and cartridges, and are currently
identifying contractors for recycling plastic and glass waste generated within facilities. HLA conducted their inaugural, year-long e-Waste
Collection Drive which recorded 620kg of e-waste collected. This initiative was in collaboration with Electronic Recycling Through Heroes
(ERTH), encouraging staff to recycle desktops, printers, laptops, smartphones, and household electrical items in a safe and responsible
manner. This contributed to the diversion of 72kg of precious metals and 6kg of toxic metals from landfills.
For additional information on HLB’s resource efficiency efforts, please refer to the HLB SR2023
For additional information on HLCB’s resource efficiency efforts, please refer to the HLCB AR2023
Bolstering the Journey
HLB RENEWABLE ENERGY FINANCING

HLB Total Approved Renewable Energy Financing
HLB set an initial target of RM500 million in Renewable Energy Over RM3.2 billion
financing for five years starting 2019. With over RM3.2 billion in
Renewable Energy financed to date, HLB has revised its target to
RM4 billion Renewable Energy financing by FY2025.
HLB’s initiatives to further the sustainability cause are seen through

the extent of green financing provided, including creating access to Any RE* Bioenergy
green transportation, driving green and sustainable development, RM182.3 million RM458.82 million
and the HLB Green Bond. To date, the cumulative total in green
transportation financing has exceeded RM812 million, with over
RM391 million in financing for electric vehicles (“EV”) mobilised in
FY2023, exceeding our initial target of RM240 million. For green and
sustainable development efforts, HLB has provided financing for
three portfolios: affordable property, green and affordable property Small Hydro Solar
and mortgage. Green bonds issued by HLB were used to finance RM163.59 million RM2,425.82 million
renewable energy projects, green building initiatives and sustainable * Any RE consists of customers with facilities that are not concentrated on
transportation efforts with outstanding balances of RM261.1 million, a single RE resource.
RM863 million, and RM412.8 million respectively.
SUSTAINABLE INVESTING AT HLCB
Prioritising clients that have embraced comprehensive internal ESG policies, practices, and commitments aligned with industry standards
is instrumental in creating additional opportunities for green and sustainable financing. In line with this, HLCB has continued their efforts in
raising capital through their offerings, including ASEAN Sustainability-Linked Bonds and Sukuk. In FY2023, HLCB has also been mandated with
two solar power projects valued at RM1.4 billion.
In FY2023, HLCB's Treasury and Markets team maintained a considerable investment in green bonds (Green energy sectors through
hydropower), whereby the holdings in the bond observed a 36% increase year-on-year. To further the Treasury & Markets teams' commitment
in addressing climate change, the team will place greater focus in seeking investment opportunities in ESG or green bonds such as solar and
hydro plants with preference given to bonds with ESG classification of C3 and above.
For additional information on HLCB’s sustainable investing efforts, please refer to the HLCB AR2023
58 • CORPORATE
DRIVING SUSTAINABLE ECONOMIC GROWTH
As a notable presence in the financial services landscape, the Group plays a role in helping to foster the country's inclusive development
and sustainable growth. We endeavour to achieve this vision by ensuring our subsidiaries mobilise financing, investments, and
insurance activities to drive economic growth, promote social development, and safeguard the climate and environment.
FINANCIAL INCLUSION & EMPOWERMENT
As a financial holding company, our foremost commitment is to ensure proper oversight of our operating entities in empowering
customers through inclusive financial solutions, primarily by leveraging the power of technology and digitalisation. To achieve this,
our subsidiaries consistently work to develop financially inclusive products, including loans, bonds, investment funds, and insurance.
With proper controls and oversight in place, our operating entities aim to serve people from diverse backgrounds so that they could
gain confidence in their financial future, build their wealth, and protect themselves against unexpected circumstances. Additionally,
we strive to democratise access of financial services to all, through our subsidiaries, by creating opportunities for the underserved,
promoting financial and digital literacy, as well as levelling the playing field for small and medium enterprises ("SMEs").
Initiatives and Progress in Driving Financial Inclusion & Empowerment
As a socially responsible business, HLB endeavours to engage in impactful initiatives that lend support to social enterprises and advocate
for enhanced financial empowerment within the community. The following are the major initiatives launched by HLB in FY2023:
Fostering Small Businesses via HLB Jumpstart - Encouraging Green Supply Chain Practices for
Micro Business Malaysian SMEs
In FY2023, HLISB launched 'HLB Jumpstart - Micro HLB hosted an exclusive session with the Small and Medium
Business,' a social finance programme that provides Enterprises Association themed "Sustainability Meets
funding to individuals with limited employment options Strategy: Enhancing Competitiveness Through Green Supply
or aspiring entrepreneurs without credit history, nurturing Chain." The session highlighted expert insights regarding
small business startups. In collaboration with MADCash changing trends in regulation, finance and market demand
and AlfieTech, the initiative provides zero-profit financing on green supply chains, helping SMEs stay ahead and make
and mentorship to ensure sustainable income sources for informed decisions for their businesses, while contributing to
underserved micro-entrepreneurs. the country’s sustainability agenda.
HLB Pocket Connect App for Junior Savers Promoting Financial Literacy via DuitSmart
In FY2023, HLB has piloted the ‘QR Pay’ feature to their HLB launched their DuitSmart platform in FY2021 to equip
Pocket Connect users. Pocket Connect app for Junior Savers, and empower Malaysians with financial knowledge to
launched in FY2021, is a market-first digital platform that influence sound financial decisions. The Bank has established
caters to both savers under the age of 18 and their parents. plans to expand the outreach programme and form strategic
Through its patented Earn, Save, and Spend interactive partnerships with PayWatch and BNM in FY2023 to FY2025.
features, the app assists young users to manage their pocket In FY2023, HLB’s DuitSmart Kids programme, conducted in
money and savings while encouraging parents to instil collaboration with Smart Reader® Worldwide, witnessed
healthy financial habits in their children at an early age. 1,789 students’ graduating from the programme.
HLCB is dedicated to promoting financial inclusion via the adoption of technology and digitalisation, with the aim of increasing
accessibility to financial services. Apart from providing a range of sustainable products to encourage responsible investments
among their clientele, HLCB also strives to enhance investing knowledge by continuously engaging with clients and local
communities.
Enabling Shariah-compliant Trading Through Platform Conducting Financial Literacy and Investment Talks
Upgrade
In July 2022, HLeBroking enhanced its trading platform to In FY2023, 15 investment talks were conducted with more
enable our customers to trade in Shariah-compliant stocks. than 1,700 participants.
By opting for Shariah accounts, customers can exclusively To promote financial literacy awareness and literacy
purchase stocks that adhere to Shariah principles. The total among the community, more than 1,400 reports were
traded value as at FY2023 amounted to more than published on HLeBroking platforms in FY2023.
RM2.5 million, with 150 accounts opened.
60 • CORPORATE
Cashless Facility for Outpatient Cancer Treatment
In line with their customer-first vision, HLA continuously strives to deliver a hassle-free customer experience journey. The latest
feature extends the cashless facility for outpatient cancer treatment benefit, which is the benefit that covers cancer therapeutic
sessions which do not require hospitalisation. This aims to replace the outgoing reimbursement method, thereby providing
customers with smooth payment experience at panel hospitals, as well as easing the financial burden of policyholders.
Additionally, this cashless facility reduces documentations required during admission and claims, and the digitalisation of
guarantee letter submission allows policyholders to track their guarantee letter facility status on the HLA360° application.
SHAPING THE FUTURE OF FINANCE VIA DIGITALISATION
At HLFG, digitalisation stands as a core value, evident in our "Digital at the Core" strategy. We are steadfast in our commitment to offer
both digital and physical access to financial services, ensuring inclusivity for underserved communities, regardless of their geographical
or socioeconomic limitations. While traditional brick-and-mortar branches remain available where and when necessary, we embrace
the dynamic digital landscape, consistently placing innovation at the forefront of our approach.
Initiatives and Progress in Digitalising Our Solutions
HLB's digital innovation efforts aim to create customer value while driving the nation towards a cashless society and advancing
the banking sector's technology. HLB’s aspirations for FY2023 are evident through the following programmes:
Launching of Cashless Sekinchan to Boost Town’s Digital Transformation for 16 Schools in

Tourism Activity Kota Kinabalu
In partnership with Payments Network Malaysia Sdn Hong Leong Bank’s ‘HLB@School’ programme offers
Bhd (“PayNet”), HLB has rolled out digital payment tools a cashless ecosystem for 16 schools, while nurturing
to help transform Sekinchan to be the first cashless financial and environmental literacy among students. The
kampung in Malaysia. This initiative equips around 800 programme facilitates digital transformation by equipping
businesses in Sekinchan with a HLB DuitNow starter kit the students of these schools with the HLB 3-in-1 Junior
that aids cashless transactions, which would popularise Account, enabling students to track their pocket money,
the town as a holiday destination, in line with its ‘Visit expenditure, and savings.
Sekinchan 2023’ campaign.
HLCB's digital innovation approach is driven by enhancing client trading and investment in the operating companies, as well as
increasing productivity and turnaround time. In FY2023, they implemented key internal digitalisation efforts, including digital client
onboarding, eStatements, and personalised services through the HL iSmart Invest data collection. Other activities undertaken in FY2023
are detailed below:
HLeBroking Digital Platforms Direct Market Access (“DMA”) Trading HLAM’s Online Transaction Platform
HLeBroking mobile application (app) DMA electronic trading solution, launched HLAM's Online Transaction Platform
offers ePayments for instant trading in July 2020, enables clients to execute has offered increased flexibility and
after fund deposition, providing a investment orders in real time at lower accessibility to fulfil clients’ specialised
seamless trading experience. costs. needs.
HLeBroking trading platform has In HLCB’s pursuit of enhancing market The HL iSmart Invest and EPF i-invest
digitised their clients’ onboarding efficiency, the DMA system will be modules offer a seamless transaction
process, reducing the turnaround time. upgraded with algorithmic trading process that enhances the user
Clients can now open their conventional capabilities, expected to complete in experience for HLAM's clients.
accounts digitally, and they can do so for FY2024. HLCB clients will thereby gain access
Shariah accounts by FY2025. to a broader range of trading options.
HLA has embraced digital technology to streamline product purchases and provide seamless customer service. These efforts are
evident in the following digital platforms and enhancements, aimed at delivering better and more personalised customer experiences.
HLA360°
The online Customer Portal enables customers to have instant and seamless access to policy information, e-medical card
and the ability to perform self-service online transactions.
50,450
41,536
429,719
37,424
373,230
307,934
FY2021 FY2022 FY2023

Registered Users Online Transactions
Robotic Process Automation (RPA)
HLA has accelerated its automation in order to create digitalised processes that help businesses scale rapidly, in line with
HLA’s modernisation and digitalisation goals. HLA has adopted RPA across various business processes, including customer
screening and data processing, in order to increase productivity, accuracy and achieve cost-savings. As at June 2023, the
RPA initiative has cumulatively saved approximately RM113,000 and more than 530 manhours. Additionally, over 180 HLA
staff have been trained as a continuous effort towards automation and process improvement.
62 • CORPORATE
Enhancing e-Policy Issuance
In an effort to reduce paper usage across the organisation, HLA monitors and drives e-Policy issuance to customers. HLA
has been diligently educating agents and customers about the benefits of e-contracts, including secured and seamless
access via HLA360°, reducing the risk of losing physical contracts.
E-Annual Statement
HLA is persistently working on improving customer satisfaction and minimising the need for physical paper handling,
evident through their ongoing efforts to digitise customer annual statements. With the E-Annual Statement, customers
will be able to view copies of their annual statements anytime and anywhere via the HLA360° customer portal. This
initiative reduces paper and printing, while providing customers with secure access.
DEVELOPING SUSTAINABLE FINANCE PRODUCTS
HLFG is committed to advocating for a sustainable financial system with a positive socio-economic impact, while also minimising harm
to the environment. To facilitate the transition to a low-carbon economy, all operating companies across the Group are encouraged
to expand their portfolio of ESG-compliant and ESG-rated offerings, aligning with our commitment to climate risk and corporate
sustainability.
As a financial holding company, we continuously strengthen our capabilities to support our subsidiaries in their transition towards
sustainable and inclusive growth. This section highlights how our subsidiaries integrate ESG considerations into their diverse range of
financial services, aligned with our Sustainability Theme, "Socially Responsible Business".
Initiatives in Developing Sustainable and Inclusive Financial Products
As a financial institution, HLB acknowledges their capacity to help drive the shift to a low-carbon economy. With the commitment
to attain Net Zero carbon emissions by 2050, they have implemented a diverse strategy, including facilitating green debt
financing via their Green Bond Framework, which focuses on projects relating to renewable energy, green transportation, as
well as sustainable developments.
HLB’s Green Bond framework adheres to the ASEAN Green Bond Standards and the globally recognised Green Bond Principles.
The HLB Green Bond portfolio has since grown in outstanding balance from RM1,056.6 million in FY2022 to RM1,536.9 million
in FY2023.
Promoting Cleaner Energy Enabling Access to Green Transportation
The transition to a low-carbon economy relies heavily on In an effort to facilitate the transition to Net Zero, HLB
moving away from high carbon emitting sources to more strived to innovate and roll-out green car financing
sustainable avenues. To this end, HLB has revised their solutions in Malaysia. Through the HLB Green Car Financing
Renewable Energy (“RE”) financing commitment, which Framework, HLB aims to increase the financing for BEV,
was initially set at RM500 million for a period of 5 years HEV and PHEV by providing attractive financing interest
starting in 2019, to RM4 billion by FY2025. By the end of rates. To date, the cumulative total in green transportation
FY2023, HLB had financed over RM3 billion in RE financing, financing has exceeded RM812 million, with over
encompassing various projects including bioenergy, solar, RM391 million financing for EV mobilised in FY2023,
hydro plant, and other RE projects. The result of its green exceeding the initial target of RM240 million.
financing is expected to save over 800,000 tCO2e emissions
in a year.
Driving Green Developments
HLB’s Developer End Financing policy, introduced in FY2021, guides and streamlines green financing for property developers.
The policy incentivises ESG integration-based sustainability scores, offering attractive financing packages and expedited
approvals for developers with low ESG risk profiles. The policy also assists developers who do not meet the Green Developer
benchmark by helping them to address their gaps and improve their ESG risk profile. Beginning FY2023, all property
development projects are required to be assessed under the green building criteria as HLB looks to drive the incorporation
of ESG practices across industries. A total of 804 companies and projects have been assessed under the ESG Assessment for
Developer End Financing in FY2023.
64 • CORPORATE
In the past two years, HLCB has kickstarted their sustainable investment journey by introducing multiple sustainability-themed
funds, and they are dedicated to further expanding their sustainable product offerings in the future. They aim to offer both
Islamic and conventional investment choices that align with their sustainability objectives and progress.
Hong Leong Global Shariah ESG Fund (“HLGSESGF”) Hong Leong PRS Growth Fund
Following the launch of the first ESG fund, HLGESGF in The Hong Leong PRS Scheme was launched in
FY2022, HLCB continued to launch HLGSESGF in FY2023, December 2022. The holistic scheme provides investors
which is also their first Shariah-compliant ESG fund. The the opportunity to diversify their retirement funds
fund is aimed at providing medium- to long-term capital by investing in various avenues including equity,
growth by investing in a globally diversified portfolio of fixed income, money markets, or balanced collective
companies with a focus on ESG criteria in the investment schemes, allowing investors to optimise their
investment process. retirement savings.
HLA firmly believes that providing responsible products and services goes hand-in-hand with delivering positive financial
outcomes to our customers.
Money Laundering & Terrorism Financing Assessment for New Product and Business Practices
- Before launching or using new products, HLA and HLMT conduct assessments to identify potential money laundering and
terrorism financing ("ML/TF") risks. All new products and services are given ML/TF risk ratings before their launch.
Integrating ESG Principles into Our Assessment Processes
We recognise our responsibility to guide our subsidiaries in implementing sustainable business models and practices that ultimately
deliver value to customers. Our operating companies are actively working to identify, acknowledge, and mitigate environmental and
social impacts related to the products and services we offer.
All operating companies within the Group follow a similar 3-stage ESG assessment framework, encompassing general exclusion
screening, sector/sub-sector screening, and entity-specific screening. The following is HLA's Investment Department’s ("ID") ESG
Assessment Framework:
For additional information on HLB’s ESG Assessment Framework, please refer to the HLB SR2023
For additional information on HLCB’s ESG Assessment Framework, please refer to the HLCB AR2023
Providing Access
Approach to Integrating to Expert
ESG Principles intoKnowledge
Assessment Procedures
Hong Leong Bank Berhad Hong Leong Capital Berhad Hong Leong Assurance Berhad
BCB (“Business & Corporate

ESG Risk Management & ESG Approaches of Investment and
Banking”) ESG Policy and
Assessment Employee Benefits Department
Assessment Framework
HLB’s BCB ESG Policy and Assessment HLCB’s Core Credit Risk Policy HLA's Investment Department's
Framework supports SMEs, integrates ESG assessment for ESG Policy includes environmental
commercial, and corporate customers lending, underwriting, and bond and social considerations in the
in high-risk Environmental & Social investments to effectively mitigate investment assessment process,
(E&S) sectors, facilitates their carbon ESG risks in accordance with BNM's resulting in an internal ESG scoring.
reduction journey and accelerates CCPT requirements. The assessment
the transition to a more sustainable evaluates clients' risk profiles, They conduct their ESG analysis on
economy. sustainability objectives, and an annual basis, or more frequently
environmental impact. if significant risks emerge, prompting
The framework assesses ESG risks necessary actions by their investment
based on national and international Hong Leong Asset Management team.
frameworks, including the UN Berhad (“HLAM”) has also
Sustainable Development Goals, established quantitative and Additionally, the ESG approach was
Value-based Intermediation Financing qualitative metrics for their ESG extended to the Employee Benefits
and Investment Impact Assessment methodology, thus empowering Department, which provides group
Framework (“VBIAF”), BNM's CCPT their fund managers to make well- term life, group hospitalisation &
guidance paper, and IFC Performance informed decisions. As of FY2023, surgical, and other coverage solutions
Standards. Enhancements to the approximately 25% of the stocks for corporate clients. The department
Framework in FY2022 enable our under coverage have incorporated has adopted ESG considerations to
Credit Risk teams to evaluate ESG trend analysis. identify and classify existing clients
customers' business activities as well based on their environmental and
as their risk mitigation prospects. social risk scoring, as guided by
BNM's CCPT.
66 • CORPORATE
PRACTISING A CONSUMER-CENTRIC CULTURE
Strengthening Consumer Relationships
Across the Group, we continuously strengthen consumer relationships through meaningful connections and provision of value-added
solutions. Our consumer-centric approach ensures that our community enjoys unfettered access to comprehensive banking services,
to help overcome geographic and socioeconomic limits. In our pursuit of digitalising our operations, we are committed to maintaining
physical branches to cater to customers who still prefer or require them in an ever-evolving digital landscape.
Through proactive engagement with our valued consumers, we have been able to extend support and provide guidance on available
financial assistance options, while also encouraging them to embrace digital banking solutions. By integrating both digital and physical
accessibility, we remain dedicated to catering to the diverse preferences and needs of our customers, striving to provide a seamless
and comprehensive banking and financial service experience for all.
Building Trust Through Fair Dealing
We firmly believe that fair dealing practices form the foundation of our business. Given the substantial monetary flow involved, we
are determined to be highly diligent in ensuring fair and transparent dealings with our consumers. Upholding the principles of integrity
and ethics, the Group is committed to promoting fair dealing and conducting business with utmost responsibility.
In our pursuit of sustainable practices, the Group places utmost importance on fair dealing as a fundamental pillar of our business
operations. Our primary objective is to instil unwavering confidence in our consumers regarding our offerings, fostering enduring
consumer loyalty that plays a vital role in driving our ongoing business growth. Committed to regulatory compliance and guided by our
Code of Conduct and Ethics, we endeavour to implement a range of fair dealing initiatives that safeguard the integrity and excellence
of our products and services, aligning them with our dedication to sustainable principles.
Ensuring Transparency Responsible Marketing
Our commitment to transparency is reflected in our The Group’s goal is to provide equitable products tailored to
operating companies’ policies and practices, upholding meet our consumer requirements. Following rigorous due
fair dealing principles and legal requirements. We provide diligence, we create terms and conditions, memorandums
clients with comprehensive information on our services and and pricing supplements, ensuring compliance with
products and ensure clear and mutually agreed-upon terms. regulatory standards before submitting them to regulators
Our efforts are supported by regularly reviewed policies, where required and/or circulating them to potential
SOPs, and codes of conduct. customers or clients.
HLB’s Fair Dealing and Treatment of Customers HLCB’s Efforts in Instiling Integrity
Through the incorporation of BNM’s Fair Treatment of HLCB has put in place measures such as Key Risk Area, SOPs
Financial Consumers (“FTFC”) Policy Document into our and training to ensure that employees and/or agents adhere
operations, HLB has managed to enhance its existing with the applicable laws and regulations. Only employees
policies to promote required standards of fair, responsible, who hold Capital Markets Services Representative’s Licence
and professional conduct when dealing with customers, (“CMSRL”) issued by SC are permitted to offer counsel on
adopting the FTFC policy document requirements that outline capital market transactions. Individuals who wish to market
the expectations for financial institutions to manage fair and distribute Unit Trust Scheme or Private Retirement
practices and provide customers with confidence in their Scheme are required to be registered with Federation of
dealings. Investment Managers Malaysia.
Strengthening Our Consumer Engagement & Experience
By proactively engaging with our consumers, we gain valuable insights into their financial needs and can henceforth pinpoint areas for
improvement. This enables all operating companies across the Group to offer tailored solutions that effectively address our consumers’
specific requirements. To foster meaningful interactions, we organise workshops, events, seminars, and online webinars that cater to
our consumers' financial needs.
Recognising the importance of leveraging digitalisation and technology to enhance the consumer experience, we are also committed
to the continuous enhancement of our IT systems across all operating companies. This commitment ensures the creation of a secure,
resilient, and efficient digital infrastructure that aligns with our consumer needs and promotes sustainable business growth.
InitiativesProviding Access
and Progress to Expert Consumer
in Enhancing KnowledgeExperience
Hong Leong Bank Berhad
Customer Experience Lab

To enhance customer experience, HLB utilises their Customer Experience ("CX") lab to understand evolving customer
demands. The CX Lab is the result of collaborative efforts from multiple stakeholders to innovate and shape customer
journeys, products, and services.
Hong Leong Capital Berhad
HLCB’s Effort in Promoting Financial Accessibility among Female Investors

In support of International Women's Day, HLCB's operating companies have taken significant strides in promoting
accessibility and financial literacy among female investors through HLeBroking Woman's Choice Campaign and HLAM
International Women's Day Campaign.
Electronic Know-Your-Customer (“e-KYC”)

In May 2023, HLCB's operating companies introduced the e-KYC solution to automate client assessment and approval in
HLeBroking's online portal, thus enhancing client onboarding.
HLAM ESG Awareness Programme

To increase awareness of their ESG funds and the importance of sustainable investing, HLAM launched their first ESG
Awareness Programme featuring various activities including:
- “Adopt a Plant”, an on-ground activity where 250 plants were prepared at Plaza Zurich lobby. Visitors are encouraged to
take home a plant as they learn about HLAM ESG funds;
- New HLAM ESG Funds Investor Campaign, a programme that rewards our new investors who signed up and invested in
HLAM ESG Fund during the campaign period.
68 • CORPORATE
WORKFORCE READINESS
The Group recognises that employees, as our most valuable asset, play a pivotal role in integrating sustainability into our operations
and creating value for stakeholders. Our goal is to foster sustainable value by embedding sustainability within our workforce and
preparing ourselves for future market developments. Through various initiatives, the Group empowers their employees to ensure
personal growth through a diverse and inclusive working environment that fuels creativity and innovation. Employee development
programmes equip them with distinct skill sets, while meaningful engagement helps maintain a high-performing workforce that is
consistently driven to deliver exceptional business results.
SUSTAINABLE TALENT DEVELOPMENT STRATEGY
Establishing a thriving and competent workforce is essential to gaining a competitive edge in the financial industry. To this end, the
Group is committed to attracting, retaining and developing top talent through thoughtfully designed programmes that foster growth,
development, and job satisfaction. This dedication to employee well-being and growth resonates throughout the Group, encouraging
our people to flourish while giving their best to serve our customers and clients.
We seek diverse and motivated candidates who are eager to contribute meaningfully to our business. To ensure inclusive hiring, we
utilise various recruitment channels. Additionally, we support ongoing professional development and offer training in leadership, role-
specific skills, and sustainability to enhance our internal capabilities.
Talent Development
Across the Group, we have adopted a Learning Framework which aims to provide a holistic approach to developing the employees of
our operating companies, enhancing their knowledge, experience, and skill sets across different areas. To establish a nurturing and
empowering work environment, we promote peer and mentor learning among our employees. We offer a comprehensive array of
development programmes, covering leadership, soft skills, and functional and technical abilities that are accessible to all.
70-20-10 TALENT DEVELOPMENT MODEL
70% On-the-job learning through job rotations, internal projects, and stretched assignments
On-the-job learning
20% Learning through focus groups, mentoring, networking, external conferences, and
workshops
Learning from others
10% Formal training through structured programmes and courses

Formal training
HONG LEONG BANK BERHAD • Talent Review and Succession Planning

- HLB provides their employees with lateral and vertical
• Employees Onboarding Programme career growth opportunities by regularly advertising
- To facilitate a seamless integration of new employees internal job openings, offering numerous career pathways
into the Bank, HLB requires them to participate in an within the company. Through the HLB Leaders Programme,
onboarding programme within the first 60 days of a personalised development plan is included as part of the
their employment. This structured virtual programme talent review and succession planning process to prepare
emphasises the Bank’s sustainability efforts, ethical potential future leaders and nurture their leadership
banking principles, and internal policies and processes. potential.
• Accreditation Programmes HONG LEONG CAPITAL BERHAD

- HLB and HLISB strive to develop the competency of
their workforce through the pursuit of accreditation • High Potential (“HiPo”) Programme
programmes, including the Chartered Bankers Programme, - Utilising the 70-20-10 model, the HiPo programme enables
Islamic Finance Qualification, and AICB Certification in Risk, effective identification and professional development of
Audit, Compliance, Credit, and AML/CFT. promising talents.
• Talent Pipeline Building Initiatives

- HLB offers structured internships and training programmes In FY2023,
including the Internship Programme, Graduate Trainee,
and Protégé, to attract and sustain a diverse and inclusive
26 EMPLOYEES
talent pipeline. They collaborate with universities to scout were identified as HiPo based on talent development, and
for talent through career fairs and campus recruitment
days. 12 EMPLOYEES
were identified as potential successors for critical roles.
70 • CORPORATE
• Continuing Professional Education ("CPE")

- HLCB has set prerequisites for all licensed employees to fulfil their Continuing Professional Education (“CPE”) requirements by
attending recognised CPE programmes conducted by the relevant authorities. All HLCB licensed employees are required to fulfil
their annual CPE requirements.
• Management Associate (“MA”)

- HLIB’s Management Associate (“MA”) programme recruits and develops graduates by allowing them to gain career exposure for
two years. Thus far, seven MA trainees have been recruited, and two of them have been confirmed as permanent staff.
• Investing in Talent Development

- To foster a high-performance workforce and ensure our talent's agility, adaptability, and future readiness, HLCB employees received
an average 11.7 hours of training during the financial year.
• Developing People Managers

- To continuously develop good leadership, HLA has organised various talks and sharing sessions to keep leaders and people
managers informed on the latest industry developments and regulatory changes. These sessions included a refresher on
anti-bribery and corruption as well as the amendments to the Employment Act, which provided a 2-way communication for
information sharing and clarifications with subject matter experts. 81 People Managers were trained under these programmes.
• HLA L.I.V.E Hour

- Recognising the importance of building strong working relationships among colleagues across business units, HLA L.I.V.E Hour is
conducted to engage employees to Learn, Interact, Value-add and be Energised. These series of programmes cover trending topics
such as Mental Health Awareness, with a workshop session to promote awareness and educate on ways to support mental health
development.
HLFG HLB HLCB HLA
Average Hours of Training 13 79 12 21
ESG Capacity-building Initiatives
The Group recognises the significance of fostering ESG knowledge and capabilities in our employees to drive our ambition of becoming
a more sustainable business. Our operating companies are actively developing structured ESG training programmes to empower their
employees to integrate ESG principles into their roles and responsibilities. Policies and SOPs enhanced with ESG considerations were
also communicated to employees across the operating companies.
• Mandatory Sustainability Training

- All HLB employees have completed the mandatory sustainability e-learning module. As part of the onboarding programme, 1,840
new hires completed the "Introduction to Sustainability" training. Additionally, in FY2023, HLB collaborated with the WWF Asia
Sustainable Finance Initiative Academy to provide fundamental knowledge on sustainability for bankwide employees, which was
completed by 1,620 employees voluntarily.
• Sustainability Month
- HLB’s annual Sustainability Month conducted in FY2023 attracted 1,910 participants. The month-long initiative was dedicated to
conducting training and raising sustainability awareness among our employees through 13 activities, including Introduction to the
HLB GHG Framework, Earth Chat Series, and Love Food, Hate Waste webinars.
• Employees as Drivers of Change

- Aligned with the Group’s sustainability commitments, HLB empowers their employees to actively contribute and make significant
community impact through the HLB Employee CSR Programme. Employees are encouraged to volunteer or initiate new
community-centred projects.
• Three-pronged ESG Awareness Training Programme

- In alignment with the Group’s sustainability objectives, HLCB is launching a comprehensive programme aiming to foster a
deeper understanding of ESG principles and encourage proactive involvement in driving positive changes at a personal level,
as employees, and as advisors. Partnered with the Asian Banking School, the training programme is scheduled to roll out from
August 2023 to January 2024.
• ESG Certification
- As of March 2023, two HLIB analysts have been ESG certified, with one of them also obtaining the CFA UK Certificate in Climate
and Investing.
• ESG Capacity-building Efforts

- In FY2023, 96 HLCB employees attended ESG-related seminars or training, totalling up to 1,068 hours of ESG capacity building.
HLAM and HLISAM have also launched quizzes and campaigns related to their ESG funds.
• Strategic Partnership for ESG Capacity Building

- HLA has been proactively building their internal ESG capacity through partnerships with external consultants. In FY2023, HLA
has continued their collaboration with the Jeffrey Sachs Centre on Sustainable Development of Sunway University to develop
a comprehensive training module to instil knowledge among employees regarding climate change and sustainability-related
issues, opportunities, and challenges. 40 employees have attended the training as of FY2023.
• 5Rs of Zero Waste – Refuse, Reduce, Reuse, Recycle and Rot

- HLA organised environmental talks for employees to create awareness and educate them on ways to practise zero-waste living
in their daily lives.
EMBRACING DIVERSITY, EQUITY, AND INCLUSION
Diversity, equity, and inclusion are foundational to our culture and the growth of our business. Embracing diversity and inclusion is
imperative as it enhances employee engagement, retention, and performance, leading to a more resilient and successful organisation.
Recognising the power of diversity and inclusivity as drivers of productivity, creativity, and innovation, we actively seek to build a
diverse workforce, engaging individuals from various backgrounds, origins, experiences, and cultures. As we strive to sustain our
diverse workplace, we are proud to report that female employees now comprise 62.7% of our Group's workforce, showcasing our
commitment to gender representation and equality.
62.7% FEMALE EMPLOYEES

of our Group's workforce
72 • CORPORATE
Employees by Gender in FY2021
15 Male
HLFG 29 Female
44 Total
2,915
HLB 4,888
7,803
228
HLCB 277
505
230
HLA 513
743
14 Male
HLFG 26 Female
40 Total
2,981
HLB 5,027
8,008
246
HLCB 299
545
222
HLA 500
722
14 Male
HLFG 31 Female
45 Total
3,014
HLB 5,193
8,207
258
HLCB 306
564
241
HLA 475
716
Employees by contract type in FY2021
15 Permanent - Male
29 Permanent - Female
HLFG
0 Non-Permanent - Male
0
Non-Permanent - Female
2,831
4,820
HLB
84
68
214
262
HLCB
14
15
208
479
HLA
22
34
14 Permanent - Male
HLFG
0
2,921
4,981
HLB
60
46
231
288
HLCB
15
11
203
474
HLA
19
26
14 Permanent - Male
HLFG
1
2,971
5,155
HLB
43
38
241
294
HLCB
17
12
208
448
HLA
33
27
74 • CORPORATE
Employees by age group in FY2021
2 <30
HLFG 32 30-50
10 >50
1,425
HLB 5,577
801
155
HLCB 258
92
213
HLA 483
47
2 <30
HLFG 29 30-50
9 >50
1,742
HLB 5,410
856
165
HLCB 278
102
190
HLAH 484
48
2 <30
HLFG 33 30-50
10 >50
2,118
HLB 5,209
880
166
HLCB 288
110
173
HLA 488
55
Employees by category in FY2021
6 Assistant
9 Executive
HLFG
18 Manager
11
Senior Managers
1,523
3,967
HLB
2,040
273
32
273
HLCB
176
24
23
492
HLA
192
36
5 Assistant
8 Executive
HLFG
18 Manager
9
Senior Managers
1,449
4,260
HLB
2,040
259
23
296
HLCB
200
26
19
457
HLA
203
43
5 Assistant
9 Executive
HLFG
22 Manager
9
Senior Managers
1,407
4,516
HLB
2,033
251
19
291
HLCB
225
29
18
436
HLA
214
48
76 • CORPORATE
PRIORITISING OUR EMPLOYEES’ WELL-BEING
Employees form the bedrock of our success, and we remain committed to encouraging healthy development and growth of our human
capital. Our approach to building a high-quality talent pool goes beyond providing promising career growth opportunities and relevant
training. Within HLFG, we promote active engagement among the operating companies and their workforce at all levels, prioritise
employee health and safety, and respect human rights regardless of the employees’ backgrounds. Providing a healthy and dedicated
workforce paves the way for achieving our business objectives and positioning ourselves as an employer of choice.
Workplace Human Rights
Adhering to the principles set forth by the United Nations Global Compact, we acknowledge our responsibility to uphold human and
labour rights. Across the Group, we are resolute in treating all employees with the utmost respect and ensuring equal opportunities for
their professional advancement. Our unwavering commitment stands against any transgression of human rights, including forced and
compulsory labour, child labour, and workplace discrimination.
Diversity, inclusion, and anti-harassment principles are integral to our operating companies’ Code of Conduct and Ethics. Across the
Group, we embrace individuals from diverse backgrounds and origins. Discrimination of any form, whether based on race, nationality,
citizenship status, religion, age, gender, pregnancy, marital status, or physical disability, is strictly prohibited.
We are committed to fostering a respectful and safe environment, where all employees, customers, and business partners are treated
with dignity and equality. Harassment or any form of inappropriate conduct, including unwelcome jokes, threats, physical contact,
derogatory comments, teasing, bullying, intimidation, or any offensive or abusive language or actions, is not tolerated at all times.
In FY2023, there were ZERO grievances or incidents reported related to harassment,

bullying, or discrimination.
Protecting Our People
It is our fundamental responsibility to provide a safe and healthy working environment for our employees. Developed in compliance
with the Occupational Health and Safety Act (“OSH Act”) 1994, our operating companies, HLB and HLCB's, Occupational Safety and
Health Standard Operating Procedure (“OSHA SOP”) guides them in managing their OSH risks.
The operating companies' OSH Committees, comprising the management and employee-representatives, oversee the implementation
of OSH-related practices across our operations. In accordance with our OSHA SOP, our designated inspection team also conducts periodic
risk assessments to identify, assess, and control safety risks and hazards at the workplace. In FY2023, there were zero incidents
reported related to workplace environment.
EMPLOYEE AS OUR DRIVE FOR POSITIVE SOCIAL IMPACT
HLFG remains committed to creating shared value for all stakeholders by promoting sustainability through engagement and advisory
initiatives. We actively engage with the wider community, making impactful environmental and social contributions that also contribute
to business growth. We are dedicated to expanding our community engagement efforts, and our employees play a significant role,
actively participating in the Group's initiatives to support local communities throughout the year.
Our operating companies have carefully selected their strategic partners, ensuring that their activities are driven by clear social and
environmental ambitions. This is imperative as it allows us to collaborate with organisations that share our values and goals, amplifying
the positive social and environmental impact we can create together.
HLFG’s Community Engagement
Providing a Brighter Future to "Orang Asli" (indigenous) Waterfall Cleaning Initiative

Children In collaboration with Persatuan Sahabat Alam Tampik Janda
In March 2023, HLFG, along with HLB Cameron Highlands branch, Baik, HLFG initiated a waterfall cleaning initiative, aiming to
collaborated with Kechara Soup Kitchen's Society School Mission preserve our nature and engage our community simultaneously.
2023, a volunteering programme aimed at supporting education 7 volunteers have participated in hiking the hill and cleaning the
in underprivileged communities, to distribute Back-to-School waterfall.
packs to children of the Semai Tribe, whose families face financial
difficulties in supporting their children's education. Through our
collective efforts, we were able to provide 1,100 children at Orang
Asli settlements with essential school supplies.
1,100 CHILDREN
at Orang Asli settlements with essential school supplies.
HLB’s Community Engagement
HLB Jumpstart - Micro Business Cashless Zakat

'HLB Jumpstart - Micro Business' provides funding to underserved HLB supports the momentum of customers’ shift towards cashless
micro-entrepreneurs, which some are dedicated to improving Zakat predominantly via the HLB Connect platform. In FY2023, 1,178
social and environmental well-being. Through these, HLB is able Zakat transactions were enabled via this platform, amounting to
to support their cause: more than RM190,000 and a 17% increase in total value compared
- SURI - a denim upcycling social enterprise that provides to FY2022.
financial opportunity and living skills for single and
underprivileged mothers.
- Green Hero - dedicated to eradicating food waste across the
1,178 ZAKAT
TRANSACTIONS
nation, providing affordable and nutritious access to food for
the budget-conscious community.
- The Asli Co - providing home-based sustainable income for were enabled via this platform, amounting to more than
Orang Asli mothers, with the long-term goal of uplifting them RM190,000 and a 17% increase in total value compared
from poverty. to FY2022.
Several initiatives were launched in recent years to support HLB’s

customers' adoption of cashless Zakat payments, including:
- Zakat payment via HLISB’s Cashless ATM, which allows
payments outside of the normal Zakat counter operating hours.
- Zakat Payment using JomPAY services, which allows Zakat
payment via internet banking platforms.
78 • CORPORATE
HLB’s Community Engagement (continued)
Flood Relief Assistance Providing Access to the Visually-Impaired Community

Determined to give back to the community, HLB initiated a ‘Flood HLB commits to being an all-inclusive organisation by serving
Relief Assistance’ programme for customers affected by the floods, communities in need of access to financial services. To that extent,
by offering payment deferments on loan and financing facilities, HLB is the first bank in Malaysia to establish speech equipped Self
including credit cards, of up to six months. The Bank also offered Service Terminals. The HLB Talking ATMs, complete with a braille
free replacements for debit and credit cards, cheques, and bank keypad and headphone socket, are designed to assist visually-
statements that were damaged or lost in the floods. Additional impaired banking customers. In FY2023, HLB introduced 12 new
financing was provided to existing SME and microenterprise HLB Talking ATMs across the country, bringing the total number of
customers that required working capital to facilitate their business HLB Talking ATMs to 17 to date.
recovery.
In FY2023, HLB introduced
12 NEW HLB
TALKING ATMS
across the country, bringing the total number of HLB
Talking ATMs to 17 to date.
HLCB’s Community Engagement
Celebrating Ramadan with Compassion Raya Celebration with Rumah Titian Kaseh
To cherish and engage underprivileged communities in the spirit HLCB donated basic essential items and Raya cookies, purchased
of Ramadan, HLCB organised a donation drive, distributing break- from Ibupreneur, a social enterprise that works to empower
fasting meals in collaboration with Pertubuhan Tindakan Wanita financially vulnerable mothers in the B40 group by equipping them
Islam (PERTIWI) Soup Kitchen to the homeless during the Ramadan with necessary skills and business opportunities, to Rumah Titian
month in FY2023. They had also engaged mosques within the Kaseh. 70 orphans benefited through this initiative.
underprivileged community areas and an orphanage to distribute
"Kurma" (dates).
Lighting up Lives for Deepavali “Back to School” Programme

In conjunction with the Deepavali celebration in October 2022, HLCB conducted our “Back to School” programme which managed
HLCB distributed 560 sets of cookies to our employees. The cookies, to donate school supplies and necessities to 2 orphanages, with
worth RM19,600, were purchased from Seven Tea One, a social a total of 52 children benefiting from the effort. Some of the
enterprise that provides a safe, inclusive, and non-discriminatory items donated were school bags, stationeries, school uniforms,
platform for differently-abled and marginalised communities to learn and necessities such as cooking utensils, food, and electrical
employment skills and earn dignified income. appliances.
HLA’s Community Engagement
Saving Our Planet Saves Us Campaign HLA e-Waste Collection Drive

HLA values collaborative efforts both within and beyond the HLA's inaugural, year-long e-Waste Collection Drive, recorded
organisation. In conjunction with World Environment Day, 620kg of e-waste collected. In collaboration with ERTH, staff were
HLA organised their Saving Our Planet Saves Us campaign in encouraged to recycle desktops, printers, laptops, smartphones,
partnership with PJ ECO Recycling Plaza, where plastic, metal, and household electrical items in a safe and responsible manner.
glass, and paper waste collected from employees were recycled. This has contributed to the diversion of 72kg of precious metals
and 6kg of toxic metals from landfills.
HLA Charity Food Drive HLA Blood Donation Drive

When the seasonal floods hit various parts of the nation, HLA HLA continued their effort in organising a Blood Donation Drive
played their part by joining forces with the Food Aid Foundation in FY2023 in conjunction with Pusat Darah Negara (PDN) and the
to provide food items to flood victims, particularly in Johor which Life Insurance Association of Malaysia’s (LIAM) Nationwide Blood
was severely affected. With staff’s support, approximately 300kg of Donation Campaign 2022. The drive had encouraged HLA staff,
food items were donated to the flood victims. agency forces and the general public to donate blood, saving more
than 170 lives.
GRI
Content Index
GRI STANDARDS CONTENT INDEX
Statement of use Hong Leong Financial Group Berhad has reported the information cited in this GRI content index for the
period 1 July 2022 to 30 June 2023 with reference to the GRI Standards.
GRI 1 used GRI 1: Foundation 2021
GRI Disclosures Page

Standards Number
GRI 2: General Disclosures 2021
GRI 2-1 Organisational details 2
GRI 2-2 Entities included in the organisation's sustainability reporting 33
GRI 2-3 Reporting period, frequency and contact point 33
GRI 2-6 Activities, value chain and other business relationships 2
GRI 2-7 Employees 72-75
GRI 2-9 Governance structure and composition 40-42
GRI 2-10 Nomination and selection of the highest governance body 41
GRI 2-11 Chair of the highest governance body 40
GRI 2-12 Role of the highest governance body in overseeing the management of impacts 40-42
GRI 2-13 Delegation of responsibility for managing impacts 40-42
GRI 2-14 Role of the highest governance body in sustainability reporting 41
GRI 2-15 Conflicts of interest 85, 87, 99
GRI 2-16 Communication of critical concerns 40-42
GRI 2-17 Collective knowledge of the highest governance body 42
GRI 2-18 Evaluation of the performance of the highest governance body 41
GRI 2-19 Remuneration policies 98-100
GRI 2-20 Process to determine remuneration 98-100
GRI 2-22 Statement on sustainable development strategy 16-20
GRI 2-23 Policy commitments 44
GRI 2-24 Embedding policy commitments 44
GRI 2-25 Processes to remediate negative impacts 45
GRI 2-26 Mechanisms for seeking advice and raising concerns 45
GRI 2-29 Approach to stakeholder engagement 35
GRI 3: Material Topics 2021
GRI 3-1 Process to determine material topics 36
GRI 3-2 List of material topics 37
GRI 3-3 Management of material topics 38-39
GRI 201: Economic Performance 2016
GRI 201-1 Direct economic value generated and distributed 3-7
GRI 201-2 Financial implications and other risks and opportunities due to climate change 46-48
80 • CORPORATE
GRI Content Index
GRI Disclosures Page

Standards Number
GRI 203: Indirect Economic Impacts 2016
GRI 203-1 Infrastructure investments and services supported 58-64
GRI 203-2 Significant indirect economic impacts 58-64, 77-79
GRI 205: Anti-corruption 2016
GRI 205-2 Communication and training about anti-corruption policies and procedures 45
GRI 301: Materials 2016
GRI 301-1 Materials used by weight or volume 56
GRI 301-2 Recycled input materials used 56
GRI 302: Energy 2016
GRI 302-1 Energy consumption within the organisation 55
GRI 303: Water and Effluents 2018
GRI 303-1 Interactions with water as a shared resource 56
GRI 303-5 Water consumption 56
GRI 305: Emissions 2016
GRI 305-1 Direct (Scope 1) GHG emissions 53
GRI 305-2 Energy indirect (Scope 2) GHG emissions 53
GRI 305-3 Other indirect (Scope 3) GHG emissions 53
GRI 306: Waste 2020
GRI 306-1 Waste generation and significant waste-related impacts 57
GRI 306-2 Management of significant waste-related impacts 57
GRI 306-4 Waste diverted from disposal 57
GRI 403: Occupational Health and Safety 2018
GRI 403-1 Occupational health and safety management system 76
GRI 404: Training and Education 2016
GRI 404-1 Average hours of training per year per employee 70
GRI 404-2 Programmes for upgrading employee skills and transition assistance programmes 68-71
GRI 405: Diversity and Equal Opportunity 2016
GRI 405-1 Diversity of governance bodies and employees 43, 72-75
GRI 406: Non-discrimination 2016
GRI 406-1 Incidents of discrimination and corrective actions taken 76
GRI 413: Local Communities 2016
GRI 413-1 Operations with local community engagement, impact assessments, and development programmes 77-79
GRI 417: Marketing and Labeling 2016
GRI 417-1 Requirements for product and service information and labeling 66
Corporate
Information
DIRECTORS
Tan Sri Quek Leng Chan (Chairman) Chong Chye Neo
Tan Kong Khoon (President & Chief Executive Officer) Ho Heng Chuan
Leong Ket Ti Emily Kok
Raja Noorma binti Raja Othman
GROUP COMPANY SECRETARY REGISTRAR

Jack Lee Tiong Jie Hong Leong Share Registration Services Sdn Bhd
MAICSA 7060133 Level 25, Menara Hong Leong
SSM PC No. 202008001704 No. 6, Jalan Damanlela
Bukit Damansara
50490 Kuala Lumpur
AUDITORS Tel : 03-2088 8818
Fax : 03-2088 8990
PricewaterhouseCoopers PLT (LLP0014401-LCA & AF1146)
Email : hlsrs@hongleong.com
Chartered Accountants
Level 10, Menara TH 1 Sentral
Jalan Rakyat REGISTERED OFFICE
Kuala Lumpur Sentral
50706 Kuala Lumpur Level 30, Menara Hong Leong
Tel : 03-2173 1188 No. 6, Jalan Damanlela
Fax : 03-2173 1288 Bukit Damansara
50490 Kuala Lumpur
Tel : 03-2080 9888
Fax : 03-2080 9801
Email : cosec-hlfg@hongleong.com.my
WEBSITE
www.hlfg.com.my
82 • CORPORATE
Board of
Directors’ Profile
TAN SRI QUEK LENG CHAN TAN KONG KHOON
Chairman/ President &

Non-Executive/Non-Independent Chief Executive Officer/Non-Independent
Malaysian 80 Male Singaporean 66 Male
YBhg Tan Sri Quek Leng Chan qualified as a Mr Tan Kong Khoon holds a Bachelor of Business
Barrister-at-Law from Middle Temple, United Kingdom. Administration degree from Bishop’s University, Canada
He has extensive business experience in various business and is an alumnus of the Harvard Business School
sectors, including financial services, manufacturing and Advanced Management Program. He is a Chartered
real estate. Banker of the Asian Institute of Chartered Bankers.
YBhg Tan Sri Quek is the Chairman of Hong Leong Mr Tan is the President & Chief Executive Officer of HLFG.
Financial Group Berhad (“HLFG”) and was appointed He was the Group Managing Director/ Chief Executive
to the Board of Directors (“Board”) of HLFG on Officer of HLB from 1 July 2013 to 4 February 2016.
6 September 1968. Prior to joining HLB, Mr Tan was the Group Executive,
Consumer Banking Group of DBS Bank Ltd (“DBS”)
from 1 December 2010 to 15 April 2013 where he led
He is the Chairman & Chief Executive Officer of Hong
and managed strategy formulation and execution for
Leong Company (Malaysia) Berhad, a public company;
consumer banking globally across the DBS Group.
Chairman of Hong Leong Bank Berhad (“HLB”), a
company listed on the Main Market of Bursa Malaysia
Mr Tan began his banking career with DBS in 1981.
Securities Berhad (“Bursa Securities”); and Chairman of Since then, he has successfully built consumer banking
Hong Leong Assurance Berhad (“HLA”), a public company. franchises across multiple markets in Asia for Citibank,
He is also the Chairman of the Council of Members of Standard Chartered Bank and ANZ Bank.
Hong Leong Bank Vietnam Limited (“HLBVN”).
From March 2007 to December 2009, Mr Tan was the
President and Chief Executive Officer of Bank of Ayudhya,
the fifth largest financial group in Thailand listed on
the Thailand Stock Exchange. The group businesses
included commercial and investment banking, life and
non-life insurance, stock broking, asset management
and consumer finance subsidiaries.
Mr Tan was appointed to the Board of HLFG on

5 February 2016.
Mr Tan is the Chairman of Hong Leong Capital Berhad

(“HLCB”) and a Director of HLB, both companies listed
on the Main Market of Bursa Securities; and a Director of
HLA and Hong Leong Investment Bank Berhad (“HLIB”),
both public companies. He is also the Chairman of Hong
Leong Bank (Cambodia) PLC and Chief Controller on the
Board of Controllers of HLBVN.
Board of Directors’ Profile
RAJA NOORMA BINTI

LEONG KET TI
RAJA OTHMAN
Non-Executive Director/ Non-Executive Director/

Independent Independent
Malaysian 60 Female Malaysian 64 Female
Ms Leong Ket Ti graduated from University of Cambridge, YM Raja Noorma binti Raja Othman holds a Bachelor of
England with a Bachelor of Arts (Hons) Cantab and holds a Business Administration degree from Ohio University,
Degree in Economics. United States of America under a twinning programme
with MARA Institute of Technology. She attended the
Ms Leong has 28 years of experience in the banking Global Leadership Development Program at Harvard
industry, having been with JP Morgan Chase Bank Berhad Business School in 2008 organised by International Centre
(“JPMorgan”) from February 1990 to January 2018 where she for Leadership in Finance (ICLIF) Malaysia. She is a member
held various senior positions, the last being the Executive of the Malaysian Institute of Accountants.
Director (“ED”), Malaysia Country Credit Officer from 2011 to
2018. As the ED, Malaysia Country Credit Officer of JPMorgan, YM Raja Noorma has more than 30 years of experience
she was responsible for a diverse portfolio of over 300 in banking, asset management and the corporate sector.
obligors across all businesses and industries. She also had Prior to her retirement in December 2018, she was the
a strong oversight role on regulatory issues and worked Head of London Branch of CIMB Bank Berhad from 2015
closely with the business/ product partners in developing to 2018. She was a Director of Group Asset Management
solutions to meet clients’ needs. (“GAM”) in CIMB Investment Bank Berhad (“CIMB IB”) from
2007 to 2015 overseeing the entire Asset Management
Prior to her position as ED, Malaysia Country Credit Office, businesses of CIMB Group. During her term as Director of
Ms Leong was Vice President/ ED, Leveraged Finance, GAM in CIMB IB, she was also the Chief Executive Officer
Regional Client Credit Management of JPMorgan from 2005 of CIMB-Mapletree Management Sdn Bhd, an adviser to a
to 2010 where she worked with their Investment Bank and privately held real estate fund.
Debt Capital Markets teams to structure and underwrite
financing transactions. Prior to joining CIMB Group, she was the Vice-President
of Investment Banking at JP Morgan, a position she held
From 2002 to 2005, Ms Leong served as Vice President & for over 5 years. She was attached to JP Morgan's offices
General Manager of JPMorgan Chase at Labuan, and from in Hong Kong, Singapore and Malaysia as industry and
2001 to 2002, she was the Vice President of Corporate client coverage banker. She had served Telekom Malaysia
Banking of JPMorgan Malaysia. Berhad, a public listed corporation for about 10 years where
the last post held was as Head of Corporate Finance. While
Ms Leong was appointed to the Board of HLFG on in Telekom Malaysia Berhad, she was a Board member of
8 March 2019 and is a member of the Board Audit and Risk several of their overseas ventures.
Management Committee (“BARMC”) of HLFG.
YM Raja Noorma was appointed to the Board of HLFG
Ms Leong is also a Director of HLCB, a company listed on the on 10 May 2019. She is the Chairman of the Nomination
Main Market of Bursa Securities. Committee (“NC”) and a member of the Group Board
Information and Technology Committee (“GBITC”) of HLFG.
YM Raja Noorma is a Director of YTL Corporation Berhad, a

company listed on the Main Market of Bursa Securities. She
also sits on the Board of other public corporations, namely
HLIB, as-Salihin Trustee Berhad and Ncell Axiata Limited.
She is an Independent Investment Committee Member of
Mapletree Australia Commercial Private Trust (MASCOT),
a Singapore based private equity real estate fund and
a member of the Investment Panel of the Employees
Provident Fund.
84 • CORPORATE
CHONG CHYE NEO HO HENG CHUAN
Non-Executive Director/ Non-Executive Director/

Independent Independent
Malaysian 60 Female Malaysian 66 Male
Ms Chong Chye Neo holds a Bachelor of Science (Hons) in Mr Ho Heng Chuan is a member of the Malaysian Institute of
Computer Science from Universiti Sains Malaysia. She had Certified Public Accountants (MICPA).
also completed several Executive Education programmes at
Harvard Business School. Mr Ho commenced his career with Messrs KPMG in 1976 as an
auditor, before moving on to the banking industry where his
Ms Chong retired as Managing Director/Chief career spanned over 39 years. He has held senior positions
Executive Officer ("MD/CEO") of IBM Malaysia Sdn Bhd in AmMerchant Bank Berhad (now known as AmInvestment
("IBM Malaysia") in December 2018 after 30 years of Bank Berhad) from 1980 to June 1998, Macquarie Bank Ltd
service and holds the distinction of being the first woman to from July 1998 to 2000 and Citi in Malaysia from 2000 to
helm the company in its then 55-year history in Malaysia. As June 2020.
MD/CEO, she was responsible for the overall management of
IBM Malaysia and Brunei, and was a Director of IBM Global Mr Ho served in various capacities in Citi, initially as
Delivery Centre (M) Sdn Bhd and Kenexa Technologies Sdn Executive Director, Head of Corporate Finance and later as
Bhd. In IBM, she held senior leadership roles that spanned Managing Director overseeing Banking for Malaysia where
across multiple disciplines of technical, sales, intellectual he was responsible for the global banking business covering
property development, business and strategy development, multinational companies, financial institutions, top tier local
and roles which gave her in-depth experience working in corporations and government linked companies. His last
multiple countries across ASEAN and Asia Pacific. position in Citi was as Vice Chairman, Banking.
In 2016, Ms Chong was recognised with the “CEO Champion Mr Ho was appointed to the Board of HLFG on
Award” by Talentcorp. In November 2017, she was appointed 15 October 2020. He is the Chairman of the BARMC and RC
to Talent Compact 4.0, a national advisory panel in response and a member of the NC of HLFG.
to the impact of Industry Revolution 4.0 and its implication
to the future of work. In April 2018, she was recognised by Mr Ho is also an Independent Non-Executive Director of
the Malaysian Business publication as one of Malaysia’s Genting Malaysia Berhad, a company listed on the Main
25 Women of Influence. She channeled her passion for Market of Bursa Securities and a Senior Advisor with the
talent development by contributing as a mentor and as a East Asia & Pacific practice at Albright Stonebridge Group.
speaker in multiple programs by ICDM, LeadWomen, 30%
Club and LeanIN Malaysia. She was a judge for UN Women
Empowerment Principles Award (Malaysia) in 2021 and
2022; and the much coveted Kincentric's Employer of the
Year awards (Malaysia) in 2020, 2021 and 2022. She regularly
spoke in forums on topics ranging from the latest in Digital
Disruptions to Leadership in the Digital Era and Developing
Women Leaders, and taught classes on Risk Management in
Information Technology ("IT") for Directors under Asia School
of Business.
Ms Chong was appointed to the Board of HLFG on

28 November 2019. She is the Chairman of the GBITC and a
member of the BARMC and Remuneration Committee (“RC”)
of HLFG.
Ms Chong currently also serves as an Independent

Non-Executive Director of Bursa Malaysia Berhad and KLCC
Property Holdings Berhad, both companies listed on the
Main Market of Bursa Securities; and as an Independent
Non-Executive Director of QSR Brands (M) Holdings Bhd,
a public company. She is also a Director of KLCC REIT
Management Sdn Bhd, the Manager of KLCC Real Estate
Investment Trust which is listed on the Main Market of Bursa
Securities.
Notes:
1. Family Relationship with Director and/or Major Shareholder

EMILY KOK None of the Directors has any family relationship with any other Director and/or
major shareholder of HLFG.
2. Conflict of Interest
None of the Directors has any conflict of interest with HLFG.
Non-Executive Director/
3. Conviction of Offences
Independent None of the Directors has been convicted of any offences (excluding traffic
offences) in the past 5 years and there were no public sanctions or penalties
imposed by the relevant regulatory bodies during the financial year ended
Malaysian 56 Female 30 June 2023.
4. Attendance of Directors
Details of Board meeting attendance of each Director are disclosed in the
Corporate Governance Overview, Risk Management & Internal Control Statement
Ms Emily Kok holds a Master of Enterprise Innovation in the Annual Report.
& Entrepreneurial Studies from Swinburne University of
Technology, Australia and a Bachelor of Science (Hons)
in Mathematical and Information Sciences from La Trobe
University, Australia. She had also attended various
C-suites executive programmes in INSEAD, IMD (Lausanne,
Switzerland) and Harvard Business School. Ms Emily is
a Fellow of the Institute of Corporate Directors Malaysia
and a member of the Chartered Institute of Management
Accountants and Institute of Certified Sustainability
Practitioners. She is a Chartered Global Management
Accountant and a sustainability reporting specialist.
Ms Emily comes from a diverse background of venture

capital, private equity, management and entrepreneurship.
A visionary entrepreneur, she has co-founded several
businesses including Rentwise Sdn Bhd, Malaysia’s
only homegrown, privately held independent lessor
specialising in operating leases of IT equipment to the
corporate sector. She was the Chief Executive Officer and
Chairman of Rentwise Sdn Bhd from 2004 to 2011. Other
businesses Ms Emily has co-founded are in the IT, financial
services and fast-moving consumer goods space.
Ms Emily has more than 20 years’ experience in direct

investment, a significant part of that with 3i Group plc as
Vice President for the Asia Pacific region from 1998 to 2003,
where she was part of the pioneering team in establishing
3i’s investment presence in Asia. Her portfolio ranged from
new technology to brick and mortar in both business-to-
business and business-to-consumer verticals.
In 2012, Ms Emily took on the position of Executive Director

at Prima Gading Sdn Bhd, the parent company of ICAN
College, and was the Chief Executive Officer of ICAN College
from 2017 to 2019. She is currently a member of the Board
of Governors of ICAN College. She has also taken on several
Board roles previously.
Ms Emily was appointed to the Board of HLFG on

26 April 2022. She is a member of the RC and NC of HLFG.
86 • CORPORATE
Key Senior
Management of the Group
TEH TIONG KHIM KEVIN LAM SAI YOKE
Group Managing Director/Chief Executive Officer of

Group Chief Financial Officer of
Hong Leong Bank Berhad (“HLB”),
Hong Leong Financial Group Berhad (“HLFG”)
a subsidiary of HLFG
Malaysian 50 Male Singaporean 54 Male
Mr Teh Tiong Khim is a Chartered Accountant, Fellow Mr Kevin Lam Sai Yoke holds an undergraduate degree
of CPA Australia and holds a Master of Business in Business Administration from the National University
Administration from University of Strathclyde, Scotland. of Singapore and is an alumnus of the Asian Financial
Leadership Program.
Mr Teh joined HLFG on 1 December 2020 as the Group
Chief Financial Officer. Mr Kevin Lam was appointed as the Group Managing
Director and Chief Executive Officer of HLB on
Mr Teh has 28 years of diverse experience in senior 1 July 2023. He is a member of both the Credit
finance roles across global business services, global IT Supervisory Committee and Executive Committee
of HLB. Mr Kevin Lam is also a Council Member of
services and a public listed company. His career trajectory
The Association of Banks in Malaysia (ABM).
has taken him through large multinational organisations
with exposure to different industries including banking,
Mr Kevin Lam possesses over 30 years of experience
fast-moving consumer goods and information technology.
in the financial landscape, having assumed various
key senior leadership roles covering 5 key markets
Prior to joining HLFG, Mr Teh was the Chief Financial in Southeast Asia namely Thailand, Vietnam,
Officer of Standard Chartered Global Business Services Singapore, Indonesia and Malaysia. He has a broad
(“SCGBS”) Malaysia. In SCGBS, he was tasked to support range of experiences in strategic planning, business
Standard Chartered Global Head of SCGBS in executing management, marketing, product development, sales
financial strategy and he played a key role in developing and distribution, banking infrastructure development,
various finance and commercial initiatives for the SCGBS digital and technology innovation. He has been
network of organisations. From 2007 to 2016, Mr Teh instrumental in leading financial institutions with
had been with British American Tobacco Group where cross-functional and cross-cultural backgrounds to build
he held various senior finance positions in their global IT long-term franchises.
organisation and finance shared services, the last being
the Regional Head of Record to Report for Asia Pacific. Prior to joining HLB, Mr Kevin Lam served as the Head
of TMRW Group Digital Banking of United Overseas Bank
Limited (“UOB”), for its key regional markets based in
Singapore. He had a decade-long experience in various
ASEAN markets including in Jakarta as the President
Director of UOB Indonesia, and in Kuala Lumpur where
he headed Personal Financial Services at UOB Malaysia
and later served as its Deputy Chief Executive Officer
where he oversaw its Wholesale Banking business and
Technology and Operations.
He had also headed the consumer banking loans, sales

and distribution in Singapore with UOB, after time with
various international banks and technology firms based
in Singapore, Hong Kong and the USA.
Key Senior
Management of the Group
LEE JIM LENG LOH GUAT LAN
Group Managing Director/Chief Executive Officer of Group Managing Director/Chief Executive Officer of
Hong Leong Investment Bank Berhad (“HLIB”), Hong Leong Assurance Berhad (“HLA”),
a subsidiary of HLFG a subsidiary of HLFG
Malaysian 60 Female Malaysian 58 Female
Ms Lee Jim Leng obtained a Bachelor of Business Ms Loh Guat Lan holds a Bachelor of Science in
Administration degree in 1984 from the Acadia University, Human Development and is a Fellow Member of
Canada and a Master of Business Administration in 1987 Life Management Institute (FLMI) and Life Office
from the Dalhousie University, Canada. Management Association (LOMA) as well as Associate,
Customer Service. She is also a Certified Financial
Ms Lee joined HLIB on 24 November 2009 and is presently Planner (CFP) and Registered Financial Planner (RFP).
the Group Managing Director/Chief Executive Officer of
HLIB. Ms Loh has extensive experience in the insurance
industry, including agency management, branch
management, and agency development and training.
Ms Lee has more than 20 years of experience in the
She was previously the Chief Operating Officer
financial industry, specialising mainly in investment
(Life Division) of HLA and was subsequently appointed
banking. Prior to joining HLIB, she was the Managing
as the Group Managing Director/Chief Executive Officer
Director of a local investment bank where she was
of HLA on 1 September 2009. Prior to joining HLA, she
responsible for the overall development of the bank’s
was in the employment of American International
investment business in Malaysia. From 1999 to 2007,
Assurance Company Limited where her last position was
she was attached to a Singapore based regional bank Vice President & Senior Director of Agency (Malaysia).
and was tasked to spearhead their investment banking
division in Malaysia and the ASEAN region. Ms Loh is the Chairman of HL Assurance Pte Ltd and a
Director of MSIG Insurance (Malaysia) Bhd, Hong Leong
Ms Lee is a Director of Hong Leong Capital Berhad, a MSIG Takaful Berhad, HLA Holdings Sdn Bhd, Hong
company listed on the Main Market of Bursa Malaysia Leong Insurance (Asia) Limited, L.I.A.M. Holding Sdn Bhd
Securities Berhad and the Chairman of Hong Leong Asset and L.I.A.M. Property Sdn Bhd. She is also a Committee
Management Bhd, a public company. She is also the Member of the Life Insurance Association of Malaysia
Council Chairman of the Malaysian Investment Banking (LIAM) and a Director of The Malaysian Insurance
Association (MIBA) and a Board Member of Asian Banking Institute. She was a Board Member of Financial Industry
School Sdn Bhd. Collective Outreach (FINCO).
Notes:
1. Family Relationship with Director and/or Major Shareholder

None of the Key Senior Management has any family relationship with any
Director and/or major shareholder of HLFG.
2. Conflict of Interest
None of the Key Senior Management has any conflict of interest with HLFG.
3. Conviction of Offences
None of the Key Senior Management has been convicted of any offences
(excluding traffic offences) in the past 5 years and there were no public
sanctions or penalties imposed by the relevant regulatory bodies during the
financial year ended 30 June 2023.
88 • CORPORATE
Board Audit and Risk Management

Committee Report
CONSTITUTION The Group Chief Financial Officer, Group Chief Risk Officer, Chief
Internal Auditor, Chief Compliance Officer, relevant employees
The Board Audit Committee of Hong Leong Financial Group and external auditors are invited to attend the BARMC meetings,
Berhad (“HLFG” or the “Company”) had been established since whenever required. At least twice a year, the BARMC will have
23 March 1994 and had been re-designated as the Board Audit separate sessions with the external auditors without the presence
and Risk Management Committee (“BARMC”) on 29 August 2001. of the management.
The BARMC will also engage privately with the Chief Compliance
COMPOSITION
Officer, Chief Internal Auditor and Group Chief Risk Officer at least
once a year to provide the opportunity for the Chief Compliance
MR HO HENG CHUAN
Officer, Chief Internal Auditor and Group Chief Risk Officer to
(Chairman, Independent Non-Executive Director)
discuss issues faced by compliance, internal audit and risk
management functions. The BARMC Chairman maintains regular
MS LEONG KET TI
engagements with the Chief Compliance Officer, Chief Internal
(Independent Non-Executive Director)
Auditor and Group Chief Risk Officer.
MS CHONG CHYE NEO

Issues raised, discussions, deliberations, decisions and
(Independent Non-Executive Director)
conclusions made at the BARMC meetings are recorded in the
minutes of the BARMC meetings. A BARMC member who has,
SECRETARY directly or indirectly, an interest in a material transaction or
material arrangement shall not be present at the BARMC meeting
The Secretary(ies) to the BARMC are the Company Secretary(ies)
where the material transaction or material arrangement is being
of the Company.
deliberated by the BARMC.
TERMS OF REFERENCE Two (2) members of the BARMC, who shall be independent, shall
constitute a quorum, and majority of the members present must
The terms of reference of the BARMC are published on the be independent directors.
Company’s website at www.hlfg.com.my.
After each BARMC meeting, the BARMC shall report and update
AUTHORITY the Board on significant issues and concerns discussed during the
BARMC meetings and where appropriate, make the necessary
The BARMC is authorised by the Board to review any activity recommendations to the Board.
of the Group within its Terms of Reference. It is authorised to
seek any information it requires from any Director or member of ACTIVITIES
management and all employees are directed to co-operate with
any request made by the BARMC. The BARMC carried out its duties in accordance with its Terms of
Reference.
The BARMC is authorised by the Board to obtain independent
legal or other professional advice if it considers necessary. During the financial year ended 30 June 2023 (“FY2023”), nine (9)
BARMC meetings were held and the attendance of the BARMC
MEETINGS members were as follows:
The BARMC meets at least four (4) times a year and additional Member Attendance
meetings may be called at any time as and when necessary. All
meetings to review the quarterly reports and annual financial Mr Ho Heng Chuan 9/9
statements are held prior to such quarterly reports and annual Ms Leong Ket Ti 9/9
financial statements being presented to the Board for approval. Ms Chong Chye Neo 9/9
Board Audit and Risk Management Committee Report
HOW THE BARMC DISCHARGES ITS The BARMC also evaluated the performance of PwC in the following
RESPONSIBILITIES areas in relation to their re-appointment as auditors for the FY2023
and considered PwC to be independent:
Financial Reporting
(a) level of knowledge, capabilities, experience and quality of
The BARMC reviewed the quarterly reports and financial statements previous work;
of the Company and of the Group focusing particularly on: (b) level of engagement with the BARMC;
(c) ability to provide constructive observations, implications and
(i) any significant changes in accounting policies and practices; recommendations in areas which require improvements;
(ii) significant adjustments arising from the audit; (d) adequacy in audit coverage, effectiveness in planning and
(iii) the going concern assumptions; and conduct of audit;
(iv) compliance with accounting standards and other legal (e) ability to perform the audit work within the agreed time
requirements. frame;
(f) non-audit services rendered by PwC does not impede
The legal and regulatory environment was monitored and independence;
consideration given to changes in law, regulation, accounting (g) ability to demonstrate unbiased stance when interpreting the
policies and practices including the Auditor Reporting Standards standards/policies adopted by HLFG; and
– ISA 701 on key audit matters and the disclosure requirements (h) risk of familiarity to ensure that the independence and
under the Main Market Listing Requirements of Bursa Malaysia objectivity of PwC was not compromised.
Securities Berhad.
PwC, in accordance with professional ethical standards, have
External Audit provided the BARMC with confirmation of their independence for
the duration of the FY2023 and the measures used to control the
The external auditors of the Group for the FY2023 is quality of their work.
PricewaterhouseCoopers (“PwC”). The BARMC discussed and
reviewed with the external auditors, before the audit commenced The BARMC has also recommended to the Board that PwC
for the financial year: be re-appointed as the auditors. Resolution concerning the
re-appointment of PwC will be proposed to shareholders at the
(i) the audit plan and timetable for the financial audit of the 2023 Annual General Meeting.
Group including the focus areas and approach to the current
financial year’s audit and any significant issues that can be Related Party Transactions
foreseen, either as a result of the past year’s experience or
due to new accounting standards or other changes in statutory The BARMC conducted quarterly review of the recurrent related
or listing requirements; and party transactions (“RRPT”) entered into by the Group to ensure
that such transactions are undertaken on commercial terms and
(ii) the methodology and timetable of the Statement on Risk on terms not more favourable to the related parties than those
Management and Internal Control. generally available to and/or from the public.
The BARMC reviewed the report and audit findings of the external The Group had put in place the procedures and processes to monitor,
auditors and considered management’s responses to the external track and identify the RRPT as well as to ensure that the RRPT are
auditors’ audit findings and investigations. The BARMC also had conducted on commercial terms consistent with the Group’s usual
two (2) separate sessions with the external auditors without the business practices and policies and on terms not more favourable
presence of the Executive Director and management where matters to the related parties than those generally available to and/or from
discussed included key reservations noted by the external auditors the public, where applicable.
during the course of their audit; whilst the BARMC Chairman
maintained regular contact with the audit partner throughout the The BARMC reviewed the said procedures and processes on an
year. annual basis and as and when required, to ensure that the said
procedures are adequate to monitor, track and identify RRPT in a
The BARMC reviewed the external audit fees and their scope timely and orderly manner, and are sufficient to ensure that the
of services. The fees payable to PwC for the FY2023 amounted RRPT will be carried out on commercial terms consistent with
to RM9,116,546, of which RM2,933,230 was payable in respect the Group’s usual business practices and policies and on terms
of non-audit services. Non-audit services accounted for 32% of not more favourable to the related parties than those generally
the total fees payable. The BARMC assessed the objectivity and available to and/or from the public.
independence of the external auditors prior to the appointment of
the external auditors for ad-hoc non-audit services.
90 • CORPORATE
Internal Audit pursuant to the Bank Negara Malaysia (“BNM”) Policy Document
on Recovery Planning for the purpose of enhancing the Group and
The BARMC reviewed the adequacy of internal audit scope, internal its significant entities preparedness in managing severe stress
audit plan and resources of the various internal audit functions events that may threaten the Group’s viability.
within the respective business units under the Group.
The BARMC also reviewed Group-wide risk resources and Business
During the financial year, BARMC noted that the various internal Continuity Management reports on staff deployment statistics
audit functions in the Group had effectively carried out internal across the Group.
audits to their respective business entities, and reviewed the
updates on the audits performed on the financial holding The BARMC was also apprised on the Group’s initiatives on
company, banking business, investment banking/ stockbroking/ integrating sustainability into its business and operations, and the
fund management/ unit trust businesses and insurance/ takaful Group’s response to the BNM’s Policy Document on Climate Risk
business as set out in the Internal Audit Function section of this Management and Scenario Analysis (CRMSA) and Climate Change
report. Principle-based Taxonomy (CCPT). The BARMC has also reviewed
the progress of managing and mitigating climate-related risks and
The review of BARMC on the audit findings and recommendations ensure that the Group’s best practices are aligned with the Task
had focused on the adequacy and integrity of internal control Force on Climate-Related Financial Disclosures (TCFD).
systems, business and compliance audits on the respective
business units. The management’s responses to internal audit’s Compliance
findings were also presented for the BARMC’s consideration. The
BARMC also reviewed at every BARMC meeting the status update The BARMC reviewed and discussed reports on compliance
of management’s corrective action plans for the resolution of for the purpose of reporting to the Board on its oversight of
internal audit findings and recommendations. Recommendations the management of compliance risks within the Group. These
were made by BARMC to ensure that the root causes raised by reports relate to matters concerning compliance with regulatory
internal audit functions in their audit reports were effectively requirements, compliance risk management, compliance initiatives
resolved and that any outstanding audit findings be tracked for and Group compliance alignment activities, including:
timely resolution.
(i) new, revised or updated regulations affecting the Group;
Risk Management and Internal Control System
(ii) significant non-compliance incidences in the Group, including
The BARMC has reviewed reports on risk management for the anti-bribery and corruption (“ABC”) non-compliance
purpose of overseeing and reporting to the Board, on the proper incidences;
functioning of Risk Management as part of its responsibilities to
assess and manage risks and uncertainties that could inhibit the (iii) development, review, alignment and implementation of
Group’s ability to achieve its business objectives. These reports Group-wide compliance policies;
cover, among others, global and regional economic developments,
risk headwinds, capital adequacy, credit risk, market risk, liquidity (iv) management of key compliance risks affecting the Group;
risk, operational risk, environment, social and governance (ESG)
risk and technology risk. (v) material compliance review findings in the Group;
The BARMC has also reviewed management’s implementation (vi) assessment of effectiveness of the overall management of
of group-wide risk management initiatives, including the Group compliance risks;
review of group-wide policies and risk appetite statements for
Board’s approval. In the FY2023, as part of the annual review (vii) implementation, alignment, monitoring and assessment
process, the BARMC reviewed the key changes made to the on effectiveness of ABC programmes within the Group,
Group policies on Risk Management, Credit Risk, Internal which includes reinforcing Board and top management
Capital Adequacy Assessment Process, Liquidity Management, commitment against bribery and corruption, review and
Operational Risk Management, Cyber Resilience and Technology enhancement of ABC control measures, monitoring of ABC
Risk Management. The changes to these policies were regulatory implementation activities, and implementation of ABC
driven, administrative and/or editorial updates. In addition, the training and communication activities; and
BARMC reviewed processes put in place to manage significant
risks encountered by the Group as well as the adequacy and (viii) significant compliance issues which require deliberation by
effectiveness of internal controls and risk management process. In the BARMC and the Board.
addition to the above annual review process, the BARMC had also
reviewed and endorsed the Recovery Plan which was developed
The BARMC also reviewed and considered the proposed compliance • Banking: audits on information technology such as
objectives, strategies, plans, governance framework and policies cybersecurity management, compliance and anti-money
for adoption and implementation within the Group, to ensure laundering, counter financing of terrorism and targeted
that Group affairs are carried out with effective compliance risk financial sanctions (“AML/CFT and TFS”), personal financial
management and in full compliance with the relevant laws and services, business corporate banking, global markets, group
regulations. In FY2023, as part of the annual review of policies, operations and technology, group functions, branches
the BARMC also reviewed changes made to Group policies on including thematic audits on branch operations, credit
compliance, governing documents, ABC, whistleblowing, personal transactions and exposures with connected parties,
data protection, and anti-money laundering and counter-financing investigations and other assignments as required by
of terrorism. regulatory bodies. Where applicable, all audits will include
coverage on compliance with Shariah requirements on
Whistleblowing Islamic banking business.
The BARMC provided oversight on the implementation and • Investment Banking/ Stockbroking/ Fund Management/
effectiveness of the Company’s Whistleblowing Policy and Unit Trust: audits on operations involving investment
Standard Operating Procedures (“Whistleblowing Policy and banking, treasury & markets, stockbroking, branches, fund
Procedures”), which set out an avenue and the process for management (both conventional and Islamic) and unit
directors and employees of the Company and any (legal or natural) trust business activities; information technology, general
person, including those providing services to, or having a business controls and application systems; regulatory compliance
relationship with the Company, to raise any concerns about any such as AML/CFT and TFS, single counterparty exposure limit,
improper conduct, or wrongful act that involves the Company, credit transactions and exposures with connected parties,
confidentially through a dedicated whistleblowing channel to liquidity coverage ratio; business support functions such as
the BARMC Chairman. In FY2023, the BARMC had reviewed the risk management, compliance, finance, human resources,
Whistleblowing Policy and Procedures of the Company to ensure procurement and outsourcing arrangements; and other
the whistleblowing procedures and communication plans in assignments as required by regulatory bodies.
relation thereto remain effective. The BARMC also reviewed
and deliberated the investigation reports submitted through the • Insurance: investment-linked transactions review,
whistleblowing channel of the Company. product set up review, business continuity management,
replacement of policy, sustainability reporting, training for
INTERNAL AUDIT FUNCTION intermediaries, e-payment reporting, statistical reporting,
outsourcing, personal data protection, information systems
The various internal audit functions within the Group entities and cybersecurity management, branches and regulatory
(“internal audit functions”) employ a risk-based assessment compliance audit such as AML/CFT and TFS.
approach in auditing the Group business and operational activities.
The high-risk activities are given due attention and audited on a • Takaful: audits on business continuity management, actuarial
more regular basis while the rest are prioritised to the potential valuation, family takaful surplus distribution, related party
risk exposure and impact. The internal audit functions are guided transactions, financial reporting (regulatory requirement),
by their respective Internal Audit Charter (“Charter”) and Internal outsourcing & vendor management, control functions such
Audit Standard Operating Procedures (“IA SOP”) which are in line as risk management, compliance, operations involving new
with BNM’s Guidelines on Internal Audit Function of Licensed business & underwriting, certificate admin & group processing,
Institutions and the International Standards for the Professional claims; regulatory compliance such as AML/CFT and TFS,
Practice of Internal Auditing. In FY2023, as part of the annual review replacement of takaful certificates; and electronic payment
process, the internal audit functions had reviewed their respective incentive framework.
Charters for changes and had tabled them to their respective board
audit committees for endorsement; and subsequently to their The cost incurred for the various internal audit functions within the
respective Boards, for approval. The IA SOP was also reviewed for Group for the FY2023 was RM19.52 million.
changes and tabled to the respective board audit committees for
their approval. This BARMC Report is made in accordance with the resolution of
the Board.
During the FY2023, the following internal audits/ reviews were
carried out:
• Financial Holding Company: audits on finance, company

secretarial, legal, human resource, risk management and
sustainability statement review.
92 • CORPORATE
Corporate Governance Overview,

Risk Management & Internal Control Statement
“Corporate Governance is the process and structure used to direct and

manage the business and affairs of the Company towards promoting
business prosperity and corporate accountability with the ultimate
objective of realising long term shareholder value while taking into
account the interest of other stakeholders.”
~ Finance Committee on Corporate Governance
The Board of Directors (“Board”) is pleased to present this financial results, investments and divestments, acquisitions
statement with an overview of the corporate governance (“CG”) and disposals, and major capital expenditure and such
practices of the Group which supports the three key principles other responsibilities that are required as specified in the
of the Malaysian Code on Corporate Governance (“MCCG”) 2021 guidelines and circulars issued by BNM from time to time.
namely board leadership and effectiveness; effective audit
and risk management; and integrity in corporate reporting and The day-to-day business of the Company is managed by the
meaningful relationship with stakeholders. President & Chief Executive Officer (“CEO”) who is assisted
by the management team. The CEO and his management
The CG Report 2023 of the Company in relation to this statement team are accountable to the Board for the performance of
is published on the Company’s website, www.hlfg.com.my the Company. In addition, the Board has established Board
(“the Company’s Website”). Committees which operate within clearly defined TOR
primarily to support the Board in the execution of its duties
The Board also reviewed the manner in which the Bank Negara and responsibilities.
Malaysia (“BNM”) policy document on Corporate Governance
(“BNM CG Policy”) is applied in the Group, where applicable, as To discharge its oversight roles and responsibilities more
set out below. effectively, the Board has delegated the independent
oversight over, inter alia, internal and external audit
A. ROLES AND RESPONSIBILITIES OF THE BOARD functions, internal controls and risk management to the
Board Audit and Risk Management Committee (“BARMC”).
The Board assumes responsibility for effective stewardship The Nomination Committee (“NC”) is delegated the
and control of the Company and has established terms authority to, inter alia, assess and review Board, Board
of reference (“TOR”) to assist in the discharge of this Committees and CEO appointments and re-appointments
responsibility. and oversee management succession planning. Although
the Board has granted such authority to the Board
In discharging its responsibilities, the Board has Committees, the ultimate responsibility and the final
established functions which are reserved for the Board decision rest with the Board. The chairmen of the Board
and those which are delegated to management. The key Committees report to the Board on matters dealt with
roles and responsibilities of the Board are set out in the at their respective Board Committee meetings. Minutes
Board Charter, which is reviewed annually by the Board of Board Committee meetings are also tabled at Board
and published on the Company’s Website. The Board meetings.
Charter was last reviewed by the Board in April 2023. The
key roles and responsibilities of the Board broadly cover There is a clear division of responsibilities between
reviewing and approving corporate policies and strategies; the Chairman of the Board and the CEO. This division of
overseeing and evaluating the conduct of the Group’s responsibilities between the Chairman and the CEO ensures
businesses; identifying principal risks and ensuring the an appropriate balance of roles, responsibilities and
implementation of appropriate systems to manage those accountability.
risks; and reviewing and approving key matters such as
A. ROLES AND RESPONSIBILITIES OF THE BOARD (continued)
The Chairman leads the Board and ensures its smooth and effective functioning.
The CEO is responsible for formulating the vision and recommending policies and the strategic direction of the Group as well as
to monitor progress on implementation of Key Performance Areas (“KPAs”) and strategic developments.
The CEO’s main responsibility is to work with the operating managers to develop strategic business plans and to set out the KPAs
for the operating managers as well as to focus on creating value through deployment of the assets in the Group and to seek
optimal use of the capital resources available to him.
Independent Non-Executive Directors (“INEDs”) are responsible for providing insights, unbiased and independent views, advice
and judgment to the Board and bring impartiality to Board deliberations and decision-making. They also ensure effective checks
and balances on the Board. There are no relationships or circumstances that could interfere with or are likely to affect the
exercise of INEDs’ independent judgment or their ability to act in the best interest of the Company and its shareholders.
The Group continues to operate in a sustainable manner and seeks to contribute positively to the well-being of stakeholders. The
Group takes a progressive approach in integrating sustainability into its businesses as set out in the Sustainability Statement in
this Annual Report.
The Board observes the Code of Ethics for Company Directors established by the Companies Commission of Malaysia (“CCM”),
which has been adopted by the Board and published on the Company’s Website. In addition, the Company also has a Code of
Conduct and Ethics for Employees that sets out sound principles and standards of good practice which are to be observed by
the employees. A Whistleblowing Policy has also been established by the Company and the said policy is published on the
Company’s Website. It provides a structured channel for all employees of the Company and any other persons providing services
to, or having a business relationship with the Company, to raise genuine concerns about any improper conduct or wrongful acts
involving the Company.
B. BOARD COMPOSITION
The Board currently comprises seven (7) Directors. The seven (7) Directors are made up of one (1) Executive Director and six (6)
Non-Executive Directors, of whom five (5) are independent. The profiles of the members of the Board are set out in this Annual
Report.
The Company is guided by the BNM CG Policy and the Main Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities
Berhad (“Bursa”) in determining its board composition. The Board shall determine the appropriate size of the Board to enable an
efficient and effective conduct of Board deliberation. The Board shall have a balance of skills and experience to commensurate
with the complexity, size, scope and operations of the Company. Board members should have the ability to commit time and
effort to carry out their duties and responsibilities effectively.
The Company has in place a Board Diversity Policy. The Board recognises the merits of Board diversity in adding value to
collective skills, perspectives and strengths to the Board. The Board will consider appropriate targets in Board diversity including
gender balance on the Board and will take the necessary measures to meet these targets from time to time as appropriate.
The Board currently has seven (7) Directors, of whom four (4) are women directors. The Board will continue to maintain women
participation on the Board in line with the MCCG.
Based on the review of the Board composition in July 2023, the Board is of the view that the current size and composition of the
Board are appropriate and effective for the control and direction of the Group’s strategy and business. The composition of the
Board also fairly reflects the investment of shareholders in the Company.
94 • CORPORATE
C. BOARD COMMITTEES
Board Committees have been established by the Board to assist in the discharge of its duties.
(A) BARMC
The composition of the BARMC and a summary of its activities in the discharge of its functions and duties for the financial
year and explanation on how the BARMC had met its responsibilities are set out in the BARMC Report in this Annual Report.
The BARMC’s functions and responsibilities are set out in the TOR which is published on the Company’s Website.
(B) NC
The NC was established on 30 October 2008. The composition of the NC is as follows:
• YM Raja Noorma binti Raja Othman (Chairman)
• Mr Ho Heng Chuan
• Ms Emily Kok
The NC’s functions and responsibilities are set out in the TOR which is published on the Company’s Website.
The Company has in place a Fit and Proper (“F&P”) Policy as a guide for the process and procedure for assessment of inter
alia, (i) new appointments and re-appointments of Chairman, Directors and CEO, (ii) appointment of Board Committee
members, and (iii) annual F&P assessment of Chairman, Directors and CEO, and the criteria and guidelines used for such
assessments. Upon the approval of the Board, an application on the prescribed forms will be submitted to BNM for
approval in respect of new appointments and re-appointments.
(i) New Appointments
The nomination, assessment and approval process for new appointments is as follows:
• Assessment against Assessment Criteria

and BNM Guidelines
• F&P Declaration by candidates Deliberation by
Identification Meeting with
• Relevant Credit Bureau Checks the Board and
of candidates candidates
• CTOS (Bankruptcy) Search decision thereof
• Independent Background Checks
• Recommendation by the NC
C. BOARD COMMITTEES (continued)
(B) NC (continued)
(i) New Appointments (continued)
In assessing the candidates for Board appointments, the NC will take into account, inter alia, the strategic and effective fit
of the candidates for the Board, the overall desired composition and required mix of expertise and experience of the Board
as a whole and having regard to the candidates’ attributes, qualifications, management, leadership, business experience
and their F&P Declarations in respect of their probity, competence, personal integrity, reputation, qualifications, skills,
experience and financial integrity in line with the standards required under the relevant BNM Guidelines. The Company
will also conduct independent background checks to verify the information disclosed in the F&P Declarations. The Company
has taken steps to build and maintain a pool of potential Board candidates from internal and external introductions,
recommendations and independent sources with director databases in its search for suitable Board candidates.
In the case of CEO, the NC will take into account the candidate’s knowledge and experience in the industry, market and
segment. The NC will also consider the candidate’s F&P Declaration in line with the standards required under the relevant
BNM Guidelines.
(ii) Re-Appointments
The assessment and approval process for re-appointments is as follows:
• Assessment against Assessment Criteria and BNM Guidelines

• F&P Declaration
• Relevant Credit Bureau Checks Deliberation by the Board
• CTOS (Bankruptcy) Search and decision thereof
• Recommendation by the NC
For re-appointments, the Chairman, Directors and CEO will be evaluated on their performance in the discharge of duties
and responsibilities effectively, including, inter alia, contribution to Board deliberations and commitment, and for
independent directors, their independence. The NC will also consider the results of the Annual Board Assessment (as
defined on the next page), their contributions during the term of office, attendance at Board meetings, F&P Declarations
in respect of their probity, competence, personal integrity, reputation, qualifications, skills, experience and financial
integrity in line with the standards required under the relevant BNM Guidelines and for Independent Directors, their
continued independence. Independent background checks will also be conducted to verify the information disclosed in
their F&P Declarations.
(iii) Board Committees Appointments
The nomination, assessment and approval process for appointments to Board Committees (“Board Committees
Appointments”) is as follows:
Identification of Directors • Assessment against Assessment Criteria

Deliberation by the Board
for Board Committees and BNM Guidelines
and decision thereof
membership • Recommendation by the NC
The assessment for Board Committees Appointments will be based on the Directors’ potential contributions and
value-add to the Board Committees with regard to Board Committees’ roles and responsibilities.
96 • CORPORATE
(B) NC (continued)
(iv) Annual F&P Assessment
The annual F&P assessment process is as follows:
• Directors to complete:
- the Board Annual Assessment Form • Assessment against Assessment Deliberation by
- the F&P Declaration Criteria and Guidelines the Board and
• CEO to complete the F&P Declaration • Recommendation by the NC decision thereof
A formal evaluation process has been put in place to assess the effectiveness of the Board as a whole, the Board
Committees and the contribution and performance of each individual Director on an annual basis (“Annual Board
Assessment”) in conjunction with the annual F&P assessment of Chairman, Directors and CEO pursuant to the BNM
Guidelines. Directors are required to complete the F&P Declaration in respect of their probity, competence, personal
integrity, reputation, qualifications, skills, experience and financial integrity in line with the standards required under
the relevant BNM Guidelines. Independent background checks will also be conducted to verify the information
disclosed in their F&P Declarations.
The NC will deliberate the results of the Annual Board Assessment and submit its recommendation to the Board for
consideration and approval. For newly appointed Directors, the Annual Board Assessment will be conducted at the
next annual assessment exercise following the completion of one year of service.
Assessment criteria for Board as a whole include, inter alia, the effectiveness of the Board composition in terms of size
and structure vis-a-vis the complexity, size, scope and operations of the Company; the core skills, competencies and
experience of the Directors; and the Board’s integrity, competency, responsibilities and performance. The assessment
criteria for Board Committees include the effectiveness of the respective Board Committees’ composition in terms
of mix of skills, knowledge and experience to carry out their respective roles and responsibilities in accordance
with the Board Committees’ TOR and the contribution of the Board Committee members. Each individual Director is
assessed on, inter alia, the effectiveness of his/her competency, expertise and contributions. The skills, experience,
soundness of judgment as well as contributions towards the development of business strategies and direction of the
Company and analytical skills to the decision-making process are also taken into consideration.
For management succession planning, it has been embedded in the Group’s process over the years to continuously identify,
groom and develop key talents from within the Group. The Group also has a talent development programme to identify,
retain and develop young high potential talents.
The NC meets at least once in each financial year and additional meetings may be called at any time as and when
necessary.
(B) NC (continued)
During the financial year ended 30 June 2023 (“FY2023”), three (3) NC meetings were held and the attendance of the NC
members were as follows:
Member Attendance
YM Raja Noorma binti Raja Othman 3/3

Mr Ho Heng Chuan 3/3
Ms Emily Kok 3/3
The NC carried out the following activities in the discharge of its duties in accordance with its TOR during the FY2023:
• Carried out the Annual Board Assessment and was satisfied that the Board as a whole, Board Committees and
individual Directors have continued to effectively discharge their duties and responsibilities in accordance with
their respective TORs, and that the current Board composition in terms of Board balance, size and mix of skills is
appropriate and effective for the discharge of its functions. The NC took cognisance of the merits of Board diversity
including women participation on the Board, in adding value to the Company. The NC will continue to maintain
women participation on the Board in line with the MCCG;
• Considered and assessed the position of Independent Directors of the Company and was satisfied that the
Independent Directors met the regulatory requirements for Independent Directors;
• Reviewed the F&P Declarations by Directors and Company Secretary in line with the BNM policy document on F&P
Criteria and was satisfied that the Directors and Company Secretary met the requirements as set out in BNM policy
document on F&P Criteria;
• Reviewed the term of office and performance of the BARMC and each of its members in accordance with the TOR
of BARMC and was of the view that the BARMC and each of its members had carried out their duties in accordance
with the BARMC TOR for the periods under review;
• Reviewed the re-appointment of Directors in accordance with the F&P Policy, BNM CG Policy and MMLR and
recommended to the Board for consideration and approval;
• Considered the re-election of Directors who are due for retirement at the Annual General Meeting (“AGM”) pursuant
to the Constitution of the Company;
• Considered the Board Policy on Succession Planning of the Board; and
• Reviewed the revisions to the F&P Policy.

98 • CORPORATE
(C) REMUNERATION COMMITTEE (“RC”)
The RC was established on 30 October 2008. The composition of the RC is as follows:
• Mr Ho Heng Chuan (Chairman)
• Ms Chong Chye Neo
• Ms Emily Kok
The RC’s functions and responsibilities are set out in the TOR which is published on the Company’s Website.
During the FY2023, two (2) RC meetings were held and the attendance of the RC members were as follows:
Member Attendance

Ms Chong Chye Neo 2/2
Ms Emily Kok 2/2
The Group’s remuneration scheme for Executive Directors is linked to performance, service seniority, experience and scope
of responsibility and is periodically benchmarked to market/industry surveys conducted by human resource consultants.
Performance is measured against profits and targets set in the Group’s annual plan and budget.
The level of remuneration of Non-Executive Directors reflects the scope of responsibilities and commitment undertaken by
them.
The RC, in assessing and reviewing the remuneration packages of Executive Directors, ensures that a strong link is
maintained between their rewards and individual performance, based on the provisions in the Group’s Human Resources
Manual, which are reviewed from time to time to align with market/industry practices. INEDs of the Company are paid
fixed annual director fees, Board Committee fees and meeting allowance for each Board and Board Committee meeting
attended. The remuneration of INEDs is recommended and endorsed by the Board for approval by the shareholders of the
Company at its AGM, and payable in cash to INEDs upon approval of the shareholders of the Company.
The detailed remuneration of each Director during the FY2023 is as set out in Note 41 of the Audited Financial Statements
in this Annual Report.
(C) REMUNERATION COMMITTEE (“RC”) (continued)
Remuneration
The remuneration strategy of Hong Leong Financial Group (“HLFG”) supports and promotes a high performance culture to
deliver HLFG’s Vision to be an integrated financial services group that consistently meets its customers’ needs. It also forms
a key part of our Employer Value Proposition with strong values, high integrity, clear sense of responsibility, high ethical
standards and the right behaviour.
The remuneration framework provides a balanced approach between fixed and variable components that is measured
using a robust and rigorous performance management process which incorporates meritocracy in performance, HLFG
values, and key behaviours in accordance to our Code of Conduct and Ethics, risk and compliance management as part of
the key performance indicators for remuneration decisions.
The remuneration framework also reinforces a strong internal governance on performance and remuneration of control
functions, which are measured and assessed independently from business units/ functions they support to avoid any
conflict of interests. The framework stipulates that for effective segregation, these staffs will be appraised principally
based on achievement of their control objectives.
Remuneration Process
The remuneration process includes strict adherence to regulatory requirements and active oversight by the Board where
the remuneration of the CEO, Senior Officers and other material risk takers are reviewed and approved by the RC and Board
annually. “Senior Officers” in this context refers to management staff who have primary and significant responsibility for
the management and performance of significant business activities of the Company and any person who assumes primary
or significant responsibility for key control functions of the Company. “Other material risk taker” refers to an officer who
is not a member of Senior Officers of the Company and who can materially commit or control significant amounts of the
Company’s resources or whose actions are likely to have a significant impact on the Company’s risk profile.
The Board maintains and regularly reviews a list of officers who fall within the definition of “Senior Officers” and “other
material risk takers”. For the FY2023, there were no “other material risk takers” identified for the Company.
Role of BARMC in remuneration matters
BARMC is tasked to review Management’s implementation of the remuneration system on whether incentives provided by
the remuneration system take into consideration risks, capital, liquidity and the likelihood and timing of earnings, without
prejudice to the tasks of the RC.
Deferred Compensation and Clawbacks
Variable bonus awards for CEO, Senior Officers and other material risk takers in excess of a certain thresholds will be
deferred over a period of time. The clawback mechanism is introduced to ensure excessive risk taking behaviour of
staff is minimised and that the system does not induce excessive risk taking and sufficient control is in place to ensure
sustainable business achievements in the long-term. Periodic reviews as well as post-implementation reporting to the
BARMC are carried out to examine the effectiveness of the schemes in driving the right behaviours in achieving business
goals and that there are no adverse risk elements in the approved schemes. The clawbacks mechanism is triggered when
there are non-compliances to regulations and policies and where Management deemed necessary due to achievements
of performance targets that are not sustainable.
100 • CORPORATE
(C) REMUNERATION COMMITTEE (“RC”) (continued)
The remuneration of the CEO and Senior Management Officers of the Company for FY2023 is shown in the tables below:
i) CEO
NAME CATEGORY CASH SHARES TOTAL

(RM) (RM) (RM)
Tan Kong Khoon Fixed remuneration 3,420,000 - 3,420,000

Variable remuneration
1) Non-deferred 5,445,850 - 5,445,850
2) Deferred 2,713,150 2,296,007* 5,009,157
ii) Senior Management Officers (including CEO)
CEO and Senior No. of officers Unrestricted Deferred Total amount Total amount
Management received (RM) (RM) of Outstanding of Outstanding
deferred deferred
remuneration remuneration
as at paid out
30.6.2023 (vested) in
(RM) FY2023
(RM)
Fixed
Remuneration
Cash-based 4 5,527,200 - - -
Shares and share- - - - - -
linked instruments
Other - - - - -
Variable
Remuneration
Cash-based 4 6,279,690 2,813,710 2,813,710 2,554,960
Shares and share- 2 - 5,739,990* 2,870,013* 2,869,977*
linked instruments
Other - - - - -
Note:
* The value of share is based on the valuation used for MFRS 2 Accounting.
(D) GROUP BOARD INFORMATION AND TECHNOLOGY COMMITTEE (“GBITC”)
The GBITC was established on 29 July 2020 to jointly support the Boards of Hong Leong Financial Group Berhad, Hong
Leong Investment Bank Berhad (“HLIB”), Hong Leong Assurance Berhad (“HLA”) and Hong Leong MSIG Takaful Berhad
(“HLMT”) (collectively “HLFG Group of Companies”) in discharging the following responsibilities:
1. Oversee technology and cyber security related matters.
2. Facilitate discussions amongst entities of the development in digital trends, to rationalise practices and policies and
where possible, to seek consistent practices across entities.
3. Ensure that risks assessments undertaken in relation to material technology applications are robust and
comprehensive.
4. Ensure that management meets the expectations on technology and cyber security risk management as set out in
BNM’s policy document on Risk Management in Technology (“BNM RMiT Policy”).
The composition of the GBITC comprises representatives from HLFG Group of Companies as follows:
• Ms Chong Chye Neo (Chairman)
• YM Raja Noorma binti Raja Othman
• YBhg Dato’ Ng Wan Peng
• YBhg Dato’ Nicholas John Lough @ Sharif Lough bin Abdullah
The GBITC’s functions and responsibilities are set out in the TOR which is published on the Company’s Website.
During the FY2023, five (5) GBITC meetings were held and the attendance of the GBITC members were as follows:
Member Attendance

YBhg Dato’ Ng Wan Peng 5/5
YBhg Dato’ Nicholas John Lough @ Sharif Lough bin Abdullah 5/5
102 • CORPORATE
C. BOARD COMMITTEES (continued) • Reviewed the impact of Insurtech and HLA’s/

HLMT’s strategy in this space;
(D) GROUP BOARD INFORMATION AND TECHNOLOGY

• Reviewed the impact of the digital investing
COMMITTEE (“GBITC”) (continued)
trend and HLIB’s strategy in this space; and
The GBITC is a platform for the sharing of knowledge

• Identified and recommended training
and experience on technology related matters with
programme(s) on topics relating to IT for learning
subject matter experts from the various group entities.
and development of Directors, and shared the
In discharging its duties in accordance with its TOR, the
topics of interest gained from the external
GBITC carried out the following activities during the
training programme(s) with the management
FY2023:
for discussion on the implications thereof to
digitalisation propositions of the Group.
• Reviewed the IT strategy and monitored the
progress against management plan;
D. INDEPENDENCE
• Reviewed the cyber security posture and key
The Board takes cognisance of the provisions of the MCCG,
security initiatives;
which states that the tenure of an Independent Director
should not exceed a cumulative term of 9 years and upon
• Reviewed the production incidents and trends;
completion of the 9 years, an Independent Director may
continue to serve on the Board subject to the Director’s
• Reviewed the state of compliance and progress
re-designation as a Non-Independent Director. It further
updates on action items in relation to the BNM
states that in the event the Board wishes to retain an
RMiT Policy;
Independent Director who has served a cumulative term of
9 years and above, shareholders’ approval shall be annually
• Reviewed and assessed IT-related policies/
sought with justification through a two-tier voting process.
guidelines encompassing technology risk
management and cyber resilience;
The tenure of all the Independent Directors on the Board
of the Company does not exceed 9 years. The Independent
• Reviewed the Business Continuity Management
Directors have declared their independence, and the NC
of the Group, including critical system downtime
and the Board have determined, at the annual assessment
and disaster recovery plans;
carried out, that the Independent Directors have continued
to bring independent and objective judgment to Board
• Reviewed the Group’s adoption of emerging
deliberations and decision making.
technologies, including the adoption status and
corresponding capabilities;
The Company has in place a policy in relation to the tenure
for Independent Directors of the Company (“Tenure Policy”)
• Deliberated on the on-going development in
under the F&P Policy of the Company. Pursuant to the Tenure
digital trends in the financial services industry,
Policy, the tenure of an Independent Director shall not
their potential application within the Group, and
exceed a cumulative term of 9 years from the date of his
exchange of thoughts on the digital strategy of
or her first appointment in the Company. Upon completion
the Group;
of the 9 years, an Independent Director shall retire on the
expiry date of his or her term of office approved by BNM.
• Reviewed the Group’s new major applications,
systems and projects;
E. COMMITMENT
• Reviewed the Group’s risk appetite statement
The Directors are aware of their responsibilities and devote
and results of compromise assessment on IT
sufficient time to carry out such responsibilities. In line
infrastructure;
with the MMLR, Directors are required to comply with the
restrictions on the number of directorships in public listed
• Reviewed the results of the BNM IT Audit for
companies. Directors provide notifications to the Board for
FY2023 of HLA/ HLMT;
acceptance of any new Board appointments.
E. COMMITMENT (continued)
This ensures that their commitment, resources and time are focused on the affairs of the Company to enable them to discharge
their duties effectively. Board meetings are scheduled a year ahead in order to enable full attendance at Board meetings. Additional
meetings may be convened on an ad-hoc basis as and when necessary. Where appropriate, decisions are also taken by way of
Directors’ Circular Resolutions. Directors are required to attend at least 75% of Board meetings held in each financial year pursuant
to the BNM CG Policy.
All Board members are supplied with information in a timely manner. The Company has moved towards electronic Board reports
since 2015. Board reports are circulated electronically prior to Board and Board Committee meetings and the reports provide, amongst
others, financial and corporate information, significant operational, financial and corporate issues, updates on the performance of
the Company and of the Group and management’s proposals which require the approval of the Board.
All Directors have access to the advice and services of a qualified and competent Company Secretary to facilitate the discharge of their
duties effectively. The Company Secretary is qualified to act under Section 235 of the Companies Act 2016. The Company Secretary
supports the effective functioning of the Board, provides advice and guidance to the Board on policies and procedures, relevant
rules, regulations and laws in relation to corporate secretarial and governance functions and facilitates effective information flow
amongst the Board, Board Committees and senior management. All Directors also have access to the advice and services of the
internal auditors and in addition, to independent professional advice, where necessary, at the Company’s expense, in consultation
with the Chairman or the CEO of the Company.
At Board meetings, active deliberations of issues by Board members are encouraged and such deliberations, decisions and conclusions
are recorded by the Company Secretary accordingly. Any Director who has, directly or indirectly, an interest in a material transaction
or material arrangement shall not be present at the Board meeting where the material transaction or material arrangement is being
deliberated by the Board.
The Board met six (6) times for the FY2023 with timely notices of issues to be discussed. Details of attendance of each director are
as follows:
Director Attendance
YBhg Tan Sri Quek Leng Chan 6/6

Mr Tan Kong Khoon 6/6
Ms Leong Ket Ti 6/6
Ms Emily Kok 6/6
The Company recognises the importance of continuous professional development and training for its directors.
The Company is guided by a Directors’ Training Policy, which covers an Induction Programme and Continuing Professional
Development (“CPD”) for Directors of the Company. The Induction Programme is organised for newly appointed Directors to assist
them to familiarise and to get acquainted with the Company’s business, governance process, roles and responsibilities as Director of
the Company. The CPD encompasses areas related to the industry or business of the Company, governance, risk management and
regulations through a combination of courses and conferences. A training budget is allocated for Directors’ training programmes.
All Directors of the Company have completed the Mandatory Accreditation Programme (“MAP”) Part I. In line with the recent
amendments to MMLR in relation to sustainability training for Directors, the Directors of the Company will complete the MAP Part
II within the prescribed timeframe.
104 • CORPORATE
E. COMMITMENT (continued) • Baker McKenzie – The Crypto Ecosystem

• Bank of Singapore – The Geopolitics Turmoil and its
The Company regularly organises in-house programmes, Impact on Family Offices with George Yeo, Former
briefings and updates by its in-house professionals. The Singapore Minister of Foreign Affairs and Chairman
Directors are also encouraged to attend seminars and of Kerry Logistics - Geopolitics - is the worst yet to
come?
briefings in order to keep themselves abreast with the latest
• BNM – Engagement Session for BNM Annual Report
developments in the business environment and to enhance
2022, Economic & Monetary Review 2022 and
their skills and knowledge. Directors are kept informed of
Financial Stability Review Second Half 2022
available training programmes on a regular basis.
• Bursa Malaysia – Anti-Bribery Management Systems –
A tool for adequate procedures
The Company has prepared for the use of its Directors, a
• Bursa Malaysia – Climate Governance Initiative: A
Director Manual which highlights, amongst others, the major
standing item on Board agendas
duties and responsibilities of a Director vis-à-vis various • Bursa Malaysia – EC-Council: The art of cyber defense
laws, regulations and guidelines governing the same. • Bursa Malaysia – Launch of the PLC Transformation
Programme Guidebook 4 – Being Digitally Enabled
In assessing the training needs of Directors, the Board and Guidebook 5: Contributing Towards Nation
has determined that appropriate training programmes Building
covering matters on corporate governance, finance, legal, • Bursa Malaysia – Presentation of PLC Transformation
risk management, information technology, cyber security, Guidebook 2 and sharing session by panellists
sustainability, internal control and/or statutory/regulatory covering their initiatives and viewpoints in
compliance, be recommended and arranged for the Directors embodying sustainability
to enhance their contributions to the Board. • Deloitte – Economic Outlook
• Deloitte – Geopolitics: Implications for Boards of the
During the FY2023, the Directors received regular briefings Shifting Landscape
and updates on the Group’s businesses, strategies, • Deloitte – Investor Roundtable
operations, risk management and compliance, internal • Deloitte – Tech Trends for Boards
controls, corporate governance, finance and any changes • Deloitte Tax Services – Budget Seminar
to relevant legislation, rules and regulations from in-house • Ernst & Young – Awareness Session Briefing on
professionals. In-house programmes were also organised for Introduction to Integrated Reporting
the Directors and senior management of the Company. • FIDE Forum – Beyond Box Ticking: Essentials for
Effective Remuneration Committees
• FIDE Forum – Can America Stop China's Rise? Will
The Directors of the Company have also attended various
ASEAN Be Damaged?
programmes and forums facilitated by external professionals
• FIDE Forum – Leadership Perspectives Forum: Board
in accordance with their respective needs in discharging
effectiveness
their duties as Directors.
• FIDE Forum – The Emerging Trends Threats and Risks
to the Financial Services Industry: Managing Global
During the FY2023, the Directors of the Company, collectively
Risk Investment and Payment System
or on their own, attended various training programmes, • HLB – The Heightened Legal & Regulatory Expectations
seminars, briefings and/or workshops including: on Sanctions
• HLCB – Anti-Money Laundering/Counter Financing
• 30% Club Malaysia Investability – Why great minds of Terrorism & Targeted Financial Sanctions:
think alike does not work anymore Prevention, Detection & Collaboration in Fronting
• Axiata – Anti-Bribery and Corruption Laws in Malaysia Compliance
and Other Countries by Law Partnership and Amicus • HLFG – Anti-Bribery and Corruption Refresher Training:
Legal Consultants Revisiting Section 17A of the Malaysian Anti-
• Axiata – Board Awareness Session on Anti-Bribery Corruption Commission (MACC) Act 2009 on
and Anti-Corruption Laws and Corruption Risk Corporate Liability Provision – Developing a Robust
Assessment Anti-Bribery & Corruption Framework as Lines of
• Baker McKenzie – A Deep Dive into NFTs Defence
• Baker McKenzie – Integrating crypto into established • HLFG – Briefing on Environmental, Social and
financial services - Funds and listings Governance by PricewaterhouseCoopers PLT
E. COMMITMENT (continued) F. ACCOUNTABILITY AND AUDIT

• HLFG – Presentation on Insurtech by JP Morgan
Securities Asia Pte Ltd The Company has put in place a framework of processes
• ICDM – Advancing Cyber Resilience : Board’s Top 3 whereby Board committees provide oversight on critical
Must-Knows processes of the Company’s reporting of financial
• ICDM – Annual BAC Dialogue & Networking 2023 statements, in order to ensure that accountability and audit
• ICDM – International Directors Summit 2022: The B are integral components of the said processes.
Factor - [Bold + Brave] Boards
• ICLIF – Building the Islamic Finance Industry’s I FINANCIAL REPORTING
Future: Creating Role Model Economies, Inclusive
Institutions and Impact-Driven Investment The Board has a fiduciary responsibility to ensure
• ICLIF – Corporate Governance & Remuneration Practices the proper maintenance of accounting records of
For The ESG World the Group. The Board receives the recommendation
• ICLIF – Risk Management Committee – Banking Sector to adopt the financial statements from the BARMC,
• ICLIF – The FIDE Core Programme which assesses the integrity of financial statements
• ICLIF – Understanding the Cyber Security Landscape with the assistance of the external auditors.
• IERP – Directors Guide to Machine Learning and
Artificial Intelligence II RISK MANAGEMENT AND INTERNAL CONTROL
• Institute of Certified Sustainability Practitioners (ICSP)
– Environment Disclosure Based on ISSB, TCFD, and
The Board has overall responsibility for maintaining
CDP
a system of internal controls which covers financial
• Maybank Investment Bank Economic Outlook &
and operational controls and risk management.
Lookout – Withdrawal Syndrome after Sugar Rush?
This system provides reasonable but not absolute
• MICPA – 64th Anniversary Commemorative Lecture
assurance against material misstatements, losses
"Towards a Better Malaysian Political Economy"
and fraud.
• National Center for Corporate Reporting (NCCR) – GRI
Standards Certified Training Course: Reporting with
GRI Standards 2021 Update The BARMC is delegated with the responsibility to
• Nomura Securities Malaysia Sdn Bhd – Malaysia provide oversight on the Company’s management of
equity strategy: How will KLCI fare in the growth vs critical risks that the Group faces, and to review the
inflation tug-of-war effectiveness of internal controls implemented in the
• Securities Commission – Audit Oversight Board Company.
Conversation with Audit Committees: How the
Audit Committees and Auditors can work together The Statement on Risk Management and Internal
towards reliable audited financial statements Control as detailed under Section I of this Statement
• Singapore Institute of Directors – Listed Entity Director provides an overview of the system of internal
Programme (LED): Environmental, Social and controls and risk management framework of the
Governance Essentials (Core) Group.
• South China Morning Post (SCMP) – Asia Sustainability
Conference 2022 III RELATIONSHIP WITH AUDITORS
• SSM – Section 17A Malaysian Anti-Corruption
Commission Act 2009 & Adequate Procedure The appointment of external auditors is recommended
• Sunway Sustainable Business Research Cluster – MSME by the BARMC, which also reviews the remuneration
e-payment systems and fintech services of the external auditors. The BARMC reviews the
• SWIFT – Sibos 2022 Conference: Progressive Finance
suitability and independence of the external auditors
For A Changing World
annually. In this regard, an annual assessment is
• The American Institute of Certified Public Accountants
conducted by the BARMC to evaluate the performance,
(“AICPA”) & Chartered Institute of Management
independence and objectivity of the external auditors
Accountants (“CIMA”) – ESG Workshop: Integrating
prior to making any recommendation to the Board on
ESG into Business
the re-appointment of the external auditors.
• AICPA & CIMA – Robotic Automation Process in
Management Accounting
106 • CORPORATE
F. ACCOUNTABILITY AND AUDIT (continued) Notices of general meetings and the accompanying
explanatory notes are provided within the prescribed
notice period on the Company’s Website, Bursa’s
III RELATIONSHIP WITH AUDITORS (continued)
website, in the media and by post to shareholders.
This allows shareholders to make the necessary
The Company also has a Policy on the Use of External
arrangements to attend and participate in
Auditors for Non-Audit Services to govern the
general meetings either in person, by corporate
professional relationship with the external auditors
representative, by proxy or by attorney.
in relation to non-audit services. Assessment will
be conducted by the BARMC for non-audit services
Shareholders can access the Company’s Website for
to ensure that the provision of non-audit services
information such as the Board Charter, TORs of Board
does not interfere with the exercise of independent
Committees, corporate information, announcements/
judgment of the external auditors.
press releases/ briefings, financial information and
investor relations. The minutes of the AGM are
During the financial year under review, the external
published on the Company’s Website.
auditors met with the BARMC to:
The Board has identified Mr Ho Heng Chuan, the
• present the scope of the audit before the
Chairman of the BARMC, as the Independent
commencement of audit; and
Non-Executive Director of the Board to whom
• review the results of the audit as well as the
concerns may be conveyed, and who would bring the
management letter after the conclusion of the
same to the attention of the Board.
audit.
In addition, shareholders and investors can have
The external auditors meet with the BARMC
a channel of communication with the Group Chief
members at least twice a year without the presence
Financial Officer to direct queries and provide
of management.
feedback to the Group.
G. DISCLOSURE Queries may be conveyed to the Group Chief Financial

Officer at:
The Company has in place a Corporate Disclosure Policy
for compliance with the disclosure requirements set out in Tel No : 03-2080 9888
the MMLR, and to raise awareness and provide guidance
Fax No : 03-2080 9800
to the Board and management on the Group’s disclosure
requirements and practices. E-mail address : cfo-hlfg@hongleong.com.my
All timely disclosure and material information documents II AGM

will be posted on the Company’s Website after release to
Bursa. The AGM provides an opportunity for the
shareholders to seek and clarify any issues and
to have a better understanding of the Group’s
H. SHAREHOLDERS
performance. Shareholders are encouraged to meet
and communicate with the Board at the AGM and
I DIALOGUE BETWEEN COMPANIES AND INVESTORS
to vote on all resolutions. Senior management and
the external auditors are also available to respond to
The Board acknowledges the importance of regular
shareholders’ queries during the AGM.
communication with shareholders and investors
via the annual reports, circulars to shareholders
and quarterly financial reports and the various
announcements made during the year, through which
shareholders and investors can have an overview of
the Group’s performance and operation.
H. SHAREHOLDERS (continued) and internal control system is operating adequately

and effectively for the financial year under review and
II AGM (continued) up to the date of approval of this report.
Pursuant to Paragraph 8.29A(1) of the MMLR, II THE RISK MANAGEMENT FRAMEWORK

all resolutions tabled at the last AGM held on
31 October 2022 were put to a vote by way of a poll and The Risk Management Framework established by the
the voting results were announced at the meeting and Board is to assist it in:
through Bursa. The Company had adopted electronic
voting for the conduct of poll on all resolutions at • identifying the significant risks faced by the
the AGM and provided e-lodgement channel for Group in the operating environment, as well as
shareholders to lodge form of proxy electronically to evaluating the impact of such risks;
the Company. • developing and approving the necessary
measures to manage these risks; and
• monitoring the effectiveness of such measures
I. STATEMENT ON RISK MANAGEMENT AND
and to develop, approve and monitor any
INTERNAL CONTROL corrective actions as may be deemed necessary.
I THE RESPONSIBILITY OF THE BOARD These processes have been in place throughout
the FY2023 and have continued up to the date this
The Board recognises its responsibilities for the statement was approved.
system of internal controls of the Group and for
reviewing its adequacy and integrity. Accordingly, The Board has entrusted the BARMC with the
the Board has established and maintained a Risk responsibility to oversee the implementation of the
Management Framework appropriate to the operations Risk Management Framework of the Group.
of the Group, including systems for compliance with
applicable laws, regulations, rules, directives and The Risk Management function administers the Risk
guidelines. Management Framework by working with various
risk management functions within the Group. These
The controls built into the Risk Management functions’ primary responsibilities are:
Framework of the Group are designed to ensure that
all relevant and significant risks are identified and • periodically evaluate all identified risks for their
managed as part of the risk management process relevance in the operating environment and
and are not intended to eliminate all risks of failure inclusion in the Risk Management Framework;
to achieve business objectives. It only provides • oversee and monitor the implementation of
a reasonable and not absolute assurance against appropriate systems and controls to manage
material misstatements, losses or frauds that may these risks;
affect the Group’s financial position or its operations. • assess the adequacy of existing action plans
and control systems developed to manage
The Board has received assurance from the President these risks;
& CEO, Group Chief Financial Officer, and the Heads • monitor the performance of management in
of Risk Management, Compliance and Internal Audit executing the action plans and operating the
functions that the Group’s risk management and control systems; and
internal control system is operating adequately and • regularly report to the BARMC on the state
effectively, in all material aspects, based on the risk of internal controls and the efficacy of
management and internal control system of the management of risks throughout the Group.
Group.
In discharging the above responsibilities, the Group’s
Based on the outcome of these reviews as well as Risk Officers are guided by but are not limited to the
the assurance it has received from management, the Statement on Risk Management & Internal Control -
Board is of the view that the Group’s risk management Guidelines for Directors of Listed Issuers.
108 • CORPORATE
I. STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL (continued)
III INTERNAL CONTROL REVIEW AND REGULATORY COMPLIANCE PROCEDURES
The Internal Audit function provides assurance regarding the adequacy and integrity of the system of internal controls.
This function works with various internal audit functions within the Group to undertake periodic and systematic reviews of
internal control systems and the review of compliance with the regulations, policies, and control procedures of the Group.
Internal audit findings, recommendations and management responses are brought to the attention of the respective board
audit and/or risk committees within the Group and the status of corrective actions will be monitored for timely resolution.
The Compliance function works with various Compliance functions within the Group to assess, monitor and manage
compliance risks in the Group and to facilitate compliance with regulatory requirements and internal policies. The compliance
framework and fundamental compliance principles of the Group, including governance framework and reporting structure,
are set out in the Group Compliance Policy. Regulatory updates and changes affecting the Group are communicated by the
Compliance function to internal stakeholders for implementation and reported to the respective board audit and/or risk
committees. All material compliance breaches and non-compliances are brought to the attention of the respective board
audit and/or risk committees within the Group and they are kept informed of the causes and the remedial measures taken.
To support effective internal controls and in ensuring compliance with relevant laws and regulations, the Compliance
function has also put in place key compliance policies such as the Group Compliance Policy, Group Anti-Bribery and
Corruption Policy, Group Whistleblowing Policy, Group Anti-Money Laundering and Counter Financing of Terrorism Policy
and Group Personal Data Protection Policy. All policies are reviewed on an annual basis or sooner as and when required to
reflect current practices or changes to applicable legal or regulatory requirements.
IV MANAGEMENT AND DECISION-MAKING PROCESSES
The Board has incorporated the Risk Management Framework as an integral component in the management and
decision-making process of the Group.
The vision and mission statements of the Group form the basis of business plans and budgets. The key strategies to
achieve these business plans and budgets are approved by the Board. The management performs periodic review to
monitor the performance of all operating units against the business plans and budgets. The budget is monitored and major
variances are followed-up by the management. These are then reported to the Board on a quarterly basis.
The Company’s financial system records business transactions to produce quarterly reports that allow management to
focus on key areas of concern. The public release of quarterly financial reporting of the Group will only be made after being
reviewed by the BARMC and approved by the Board.
The Group has a well-defined organisational structure with clearly defined authorities, accountability and segregation of
duties. The respective heads of the operating subsidiaries of the Group operate their respective units within the policies,
functional, financial and operating reporting standards and control procedures developed by the Group. Such reporting
standards and control procedures are supplemented by operating procedures developed by the operating units to suit the
regulatory and business environment, in which they operate.
The Group has identified the following principal risks on its operations, including but not limited to credit risk, market
risk, liquidity risk, operational risk, compliance risk and environmental, social and governance risk. Risk management
policies to guide operating subsidiaries of the Group have been established and these policies are reviewed annually to
incorporate regulatory driven, administrative and/or editorial updates. Each operating unit has a number of functional
departments and/or units that will be responsible for managing and monitoring risks through limits, procedures and
oversight. Where feasible and necessary, relevant group resources are focused to manage and monitor common risks on
an integrated and Group-wide basis, using common tools, procedures and control systems as appropriate.
I. STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL (continued)
IV MANAGEMENT AND DECISION-MAKING PROCESSES (continued)
As required by Paragraph 15.23 of the MMLR, the external auditors have reviewed this Statement on Risk Management
and Internal Control. Their limited assurance review was performed in accordance with Audit and Assurance Practice Guide
(“AAPG”) 3 issued by the Malaysian Institute of Accountants. AAPG 3 does not require the external auditors to form an
opinion on the adequacy and effectiveness of the risk management and internal control systems of the Group.
J. DIRECTORS’ RESPONSIBILITY IN FINANCIAL REPORTING
The MMLR require the Directors to prepare a statement explaining the board of directors’ responsibility for preparing the annual
audited financial statements and the Companies Act 2016 requires the directors to make a statement stating whether in their
opinion, the audited financial statements are drawn up, in accordance with the applicable accounting standards, to give a true
and fair view of the financial position and of the financial performance of the Group and of the Company for the financial year.
The Directors are satisfied that in preparing the financial statements of the Group and of the Company for the FY2023, the Group
has used the appropriate accounting policies and applied them consistently. The Directors are also of the view that relevant
approved accounting standards have been followed in the preparation of these financial statements.
This Statement on Corporate Governance Overview, Risk Management and Internal Control is made in accordance with the resolution
of the Board.
110 • FINANCIALS
Directors’ Report
for the financial year ended 30 June 2023
The Directors are pleased to present their report together with the audited financial statements of the Group and of the Company for
the financial year ended 30 June 2023.
PRINCIPAL ACTIVITIES
The principal activities of the Company are those of investment holding and provision of services to its subsidiaries to enhance group
value.
The Hong Leong Financial Group (the Company and its subsidiaries) is a diversified financial group whose businesses provide a broad
range of financial products and services to consumer, corporate and institutional customers.
The principal activities of the significant subsidiaries consist of commercial banking business, Islamic banking services, insurance and
family takaful business, investment banking, futures and stock broking and asset management business as disclosed in Note 11 to
the financial statements.
There have been no significant changes in the principal activities of the Group and the Company during the financial year.
FINANCIAL RESULTS
The Group The Company

RM’000 RM’000
Net profit after taxation:

- Owners of the parent 2,791,303 857,882
- Non-controlling interests 1,416,316 -
4,207,619 857,882
DIVIDENDS
The dividends on ordinary shares paid by the Company since the previous financial year ended 30 June 2022 were as follows:
(a) A final single-tier dividend of 31.0 sen per share, amounting to RM352,791,561, in respect of the financial year ended
30 June 2022, was paid on 23 November 2022.
(b) An interim single-tier dividend of 17.0 sen per share, amounting to RM193,492,929 in respect of the financial year ended
30 June 2023, was paid on 30 March 2023.
The Directors have declared a final single-tier dividend of 32.0 sen per share in respect of the financial year ended 30 June 2023. The
financial statements for the current financial year do not reflect this dividend and will be accounted for in equity as an appropriation
of retained profits in the next financial year ending 30 June 2024.
SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR
Significant events during the financial year are disclosed in Note 55 to the financial statements.
SUBSEQUENT EVENTS AFTER THE FINANCIAL YEAR
Significant events subsequent to the financial year are disclosed in Note 56 to the financial statements.
Directors’ Report
CREDIT RATING
On 30 August 2023, RAM Rating Services Berhad has reaffirmed AA1/Stable/P1 corporate credit ratings (CCRs) to Hong Leong Financial
Group Berhad (the Company or the Group). All the long-term ratings have a stable outlook.
Details of the ratings are as follows:
Rating Classification
Corporate Credit Ratings AA1/Stable/P1

Multi-Currency Senior Notes, Tier-2 Subordinated Notes and Additional Tier-1 Capital Securities
Programme of up to RM25.0 billion*
i. Senior Notes AA1/Stable
ii. Tier-2 Subordinated Notes AA2/Stable
iii. Additional Tier-1 Capital Securities A1/Stable
Commercial Papers Programme of up to RM3.0 billion* P1
* combined limit of RM25.0 billion
RESERVES AND PROVISIONS
There were no material transfers to or from reserves or provisions during the financial year other than those disclosed in the financial
statements.
CORPORATE GOVERNANCE
The corporate governance disclosures are set out in the Corporate Governance Overview, Risk Management and Internal Control
Statement.
DIRECTORS
The Directors of the Company who have held office during the financial year and during the period from the end of the financial year
to the date of this report are:
Tan Sri Quek Leng Chan (Chairman, Non-Executive Non-Independent)

Tan Kong Khoon (President & Chief Executive Officer, Non-Independent)
Leong Ket Ti (Independent Non-Executive Director)
Raja Noorma binti Raja Othman (Independent Non-Executive Director)
Chong Chye Neo (Independent Non-Executive Director)
Ho Heng Chuan (Independent Non-Executive Director)
Emily Kok (Independent Non-Executive Director)
112 • FINANCIALS
Directors’ Report
DIRECTORS (continued)
The Directors of the Company’s subsidiaries who have held office during the financial year and during the period from the end of the
financial year to the date of this report (not including those Directors listed above) are:
Alan Hamzah Sendut Liew Chin Chong

Ang Beng Kuan Lim Tau Kien
Au Chee Ming Loh Guat Lan
Chan Lap Yuen Malkiat Singh @ Malkit Singh Maan a/l Delbara Singh
Chee Fei Meng Mark Nelligan
(Appointed with effect from 6 March 2023) Martin Giles Manen
Cheong Soo Ching Masayuki Takahashi
Chew Seong Aun (Resigned with effect from 17 July 2023)
Chok Kwee Bee Matthew Nicholas Rendall
(Resigned with effect from 1 December 2022) Mitsuru Yasuda
Dato’ Abdul Majit bin Ahmad Khan (Appointed with effect from 17 July 2023)
Dato’ Bakarudin bin Ishak Mohd Faizal bin Ali
Dato’ Ng Wan Peng (Ceased with effect from 3 August 2023)
Dato’ Nicholas John Lough @ Sharif Lough bin Abdullah Muhammad Awi Goo @ Goo Kim Hooi
Dato’ Siow Kim Lun @ Siow Kim Lin Musa bin Mahmood
Datuk Dr Md Hamzah bin Md Kassim Noor Aini binte Shaik Awab
Datuk Manharlal a/l Ratilal Norhayati binti Abu Bakar

(Ceased with effect from 3 August 2023)
Domenico Fuda
(Resigned with effect from 30 June 2023) Peter Ho Kok Wai
Duong Duc Hung Quek Kon Sean
Fa’izah binti Mohamed Amin Rowina Ghazali Seth
Gan Siok Loon Shalet Marian
Han Chin May Sharan Kaur a/p Jaswant Singh
Harjit Kaur a/p Inder Singh Sim Hong Kee

(Resigned with effect from 10 January 2023) Stella Lo Sze Man
Hoo See Kheng Tai Siew Moi
Jacelyn Khoo June Lee Tan Chan Yien
John Hing Vong (Appointed with effect from 10 January 2023)
Khoo Teng Kar Tan Khee Meng
Koid Swee Lian Tang Hong Cheong
Kwek Leng Hai Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin
Lau Souk Huan Wong Kwok Tim
Lau Yew Sun Wong Mun Heng
Lawrence Peh Yeow Beng Yong Yoong Fa
Lee Jim Leng Zulkiflee bin Hashim
Details of subsidiaries are set out in Note 11 to the financial statements.

Directors’ Report
DIRECTORS’ INTERESTS
According to the Register of Directors’ Shareholdings required to be kept by the Company under Section 59 of the Companies Act 2016,
the Directors holding office at the end of the financial year who had beneficial interests in the ordinary shares and/or preference shares
and/or loan stocks and/or options over ordinary shares of the Company and/or its related corporations during the financial year are as
follows:
Directors’ direct interests

Number of ordinary shares/preference shares/ordinary shares issued or to
be issued or acquired arising from the exercise of options*/conversion of
redeemable convertible unsecured loan stocks**/nominal value in Ringgit
Malaysia of Additional Tier 1 capital securities/perpetual subordinated sukuk
wakalah***/nominal value in Ringgit Malaysia of Tier 2 subordinated notes/
subordinated sukuk murabahah****/ordinary shares to be received arising
from vesting of share grant*****
As at As at
01.07.2022 Acquired Sold 30.06.2023
Interests of Tan Sri Quek Leng Chan in :

Hong Leong Company (Malaysia) Berhad 390,000 - - 390,000
Hong Leong Financial Group Berhad 5,438,664 - - 5,438,664
Interests of Tan Kong Khoon in:

Hong Leong Financial Group Berhad 250,245***** - (125,123) *****(5) 125,122*****
125,123 125,123 (5)
- 250,246
114 • FINANCIALS
Directors’ Report
DIRECTORS’ INTERESTS (continued)
Directors’ deemed interests

Number of ordinary shares/preference shares/ordinary shares issued or to
be issued or acquired arising from the exercise of options*/conversion
of redeemable convertible unsecured loan stocks**/nominal value
in Ringgit Malaysia of Additional Tier 1 capital securities/perpetual
subordinated sukuk wakalah***/ nominal value in Ringgit Malaysia
of Tier 2 subordinated notes/subordinated sukuk murabahah****/
ordinary shares to be received arising from vesting of share grant*****
As at As at
01.07.2022 Acquired Sold 30.06.2023
Interests of Tan Sri Quek Leng Chan in :

Hong Leong Company (Malaysia) Berhad 7,651,455(1) - - 7,651,455(1)
Hong Leong Financial Group Berhad 894,714,726(1) - - 894,714,726(1)
Hong Leong Capital Berhad 173,805,058 - - 173,805,058
Hong Leong Bank Berhad 1,346,027,209 - - 1,346,027,209
800,000,000*** - (400,000,000) *** 400,000,000***
1,500,000,000**** 100,000,000**** (500,000,000) **** 1,100,000,000****
Hong Leong MSIG Takaful Berhad 130,000,000 - - 130,000,000
Hong Leong Assurance Berhad 140,000,000 - - 140,000,000
Hong Leong Islamic Bank Berhad 400,000,000*** 400,000,000*** (400,000,000) *** 400,000,000***
400,000,000**** - - 400,000,000****
Hong Leong Industries Berhad 242,700,470 (1)
21,000 - 242,721,470(1)
Hong Leong Yamaha Motor Sdn Bhd 17,352,872 - - 17,352,872
Malaysian Pacific Industries Berhad 116,205,192 - (16,667) 116,188,525
Carter Resources Sdn Bhd 5,640,607 - - 5,640,607
Carsem (M) Sdn Bhd 84,000,000 - - 84,000,000
22,400 (2)
- - 22,400(2)
Hume Cement Industries Berhad 353,486,658(1) 8,040,000(3) (9,965,000)
352,701,658(1)
1,140,000 (1)(4)
197,043,175**(1) - (4,020,000) ** 193,023,175**(1)

1,140,000*(1) - (1,140,000) *(1)(4) -
Southern Steel Berhad 417,246,046 - - 417,246,046
Southern Pipe Industry (Malaysia) Sdn Bhd 124,964,153 560,320 - 125,524,473
Notes:
(1)
Inclusive of interest pursuant to Section 59(11)(c) of the Companies Act 2016 in shares held by family member
(2)
Redeemable Preference Shares/ Cumulative Redeemable Preference Shares
(3)
Inclusive of new ordinary shares acquired arising from the conversion of redeemable convertible unsecured loan stocks
(4)
Exercise of share options
(5)
Vesting of grant shares
Directors’ Report
DIRECTORS’ BENEFITS
Since the end of the previous financial year, none of the Directors of the Company received or became entitled to receive any benefit
(other than the benefits shown under Directors’ Remuneration in Note 41 to the financial statements, included in the aggregate
amount of remuneration received or due and receivable by the Directors as shown in the financial statements or as fixed salary of a
full-time employee of the Company or of related corporations) by reason of a contract made by the Company or its related corporations
with the Director or with a firm of which the Director is a member, or with a company in which the Director has a substantial financial
interest except for YBhg Tan Sri Quek Leng Chan, who may be deemed to derive a benefit by virtue of those transactions, contracts
and agreements for the acquisition and/or disposal of stocks and shares, stocks-in-trade, products, parts, accessories, plants, chattels,
fixtures, buildings, land and other properties or any interest in any properties; and/or for the provision of services, including but not
limited to project and sales management and any other management and consultancy services; and/or for construction, development,
leases, tenancy, licensing, dealership and distributorship; and/or for the provision of treasury functions, advances in the conduct of
normal trading, banking, insurance, investment, stockbroking and/or other businesses between the Company or its related corporations
and corporations in which YBhg Tan Sri Quek Leng Chan is deemed to have interests.
Neither during nor at the end of the financial year was the Company or any of its subsidiaries a party to any arrangements whose
object was to enable the Directors to acquire benefits by means of the acquisition of shares in, or debentures of the Company or any
other body corporate, other than the share options granted pursuant to the Executive Share Scheme.
EXECUTIVE SHARE SCHEME
The Company has concurrently implemented two (2) Executive Share Schemes during the financial year ended 30 June 2023.
(i) Executive Share Scheme (“ESS 2013”)
The ESS 2013 of up to ten percent (10%) of the total number of issued shares (excluding treasury shares) of the Company
comprises the Executive Share Option Scheme 2013 (“ESOS 2013”) and the Executive Share Grant Scheme 2013 (“ESGS 2013”).
(a) ESOS 2013
The ESOS 2013 which was approved by the shareholders of the Company on 30 October 2012, was established on
12 March 2013 and had expired on 11 March 2023.
(b) ESGS 2013
The ESGS 2013 which was approved by the shareholders of the Company on 29 October 2013, was established on
28 February 2014 and had expired on 11 March 2023.
At any point of time during the existence of the ESS 2013, the aggregate number of shares comprised in the options and grants
under the ESS 2013 and any other executive share schemes established by the Company which are still subsisting shall not
exceed 10% of the total number of issued shares (excluding treasury shares) of the Company at any one time (“Aggregate
Maximum Allocation”).
116 • FINANCIALS
Directors’ Report
EXECUTIVE SHARE SCHEME (continued)
STATUS ON ESOS 2013
There were no options granted under the ESS 2013 of the Company during the financial year ended 30 June 2023.
As at the expiry date of 11 March 2023, a total of 32,839,819 options had been granted under the ESS 2013, out of which
2,882,000 options had been exercised, with no options remain outstanding. The aggregate options granted to Directors and chief
executives of the Group under the ESS 2013 amounted to 18,081,823, out of which 1,600,000 options had been exercised, with
no options remain outstanding.
Since the commencement of the ESS 2013, the maximum allocation applicable to Directors and senior management of the Group
is 50% of the Aggregate Maximum Allocation.
As at the expiry date of 11 March 2023, the actual percentage of total options granted to Directors and senior management of
the Group under the ESS 2013 was 2.54% of the total number of issued shares (excluding treasury shares) of the Company.
STATUS ON ESGS 2013
There were no grants granted under the ESS 2013 of the Company during the financial year ended 30 June 2023.
As at the expiry date of 11 March 2023, a total of 469,210 grants had been granted under the ESS 2013, out of which 312,808
grants had been vested, with 156,402 grants remain outstanding. The aggregate grants granted to Directors and chief executives
of the Group under the ESS 2013 amounted to 375,368, out of which 250,246 grants had been vested, with 125,122 grants
remain outstanding.
The remaining 156,402 grants granted under the ESS 2013, including the 125,122 grants granted to Directors and chief executives
of the Group, were transferred to the Executive Share Scheme 2022 of the Company (“ESS 2022”) upon the expiry of the
ESS 2013 on 11 March 2023 and would be administered and vested to the eligible executives under the ESS 2022.
Since the commencement of the ESS 2013, the maximum allocation applicable to Directors and senior management of the Group
is 50% of the Aggregate Maximum Allocation.
As at the expiry date of 11 March 2023, the actual percentage of total grants granted to Directors and senior management of
the Group under the ESS 2013 was 0.03% of the total number of issued shares (excluding treasury shares) of the Company.
(ii) ESS 2022
The Company had on 28 April 2022 established the ESS 2022, which comprise a new executive share option scheme
(“ESOS 2022”) and a new executive share grant scheme (“ESGS 2022”) for the eligible executives and/or Directors of the
Company and its subsidiaries (“Group”) (such executives and Directors, “Eligible Executives”). The ESS 2022 shall be in force until
terminated by the Board of Directors of the Company.
The ESS 2022 would enable the Company to align the long-term interests of Eliglible Executives with those of the shareholders
of the Company, as well as to motivate and reward them.
Directors’ Report
EXECUTIVE SHARE SCHEME (continued)
STATUS ON ESOS 2022 AND ESGS 2022
There were no options or grants granted under the ESS 2022 of the Company during the financial year ended 30 June 2023 and
since the commencement of the ESS 2022. However, a total of 156,402 grants granted under the ESS 2013, including 125,122
grants granted to Directors and chief executives of the Group, were transferred to the ESS 2022 upon expiry of the ESS 2013 on
11 March 2023 and would be administered and vested to the Eligible Executives under the ESS 2022.
A trust has been set up for the ESS 2013 and ESS 2022 and it is administered by an appointed trustee. This trustee will be entitled from
time to time to accept financial assistance from the Company upon such terms and conditions as the Company and the trustee may
agree to purchase the Company’s shares from the open market for the purposes of this trust. In accordance with MFRS 132, the shares
purchased for the benefit of the ESS holdings are recorded as “Treasury Shares for ESS” in the shareholders’ equity on the statements
of financial position. The cost of operating the ESS is charged to the statements of income.
For further details on the ESS 2013 and ESS 2022, refer to Note 54 on equity compensation benefits.
SHARE CAPITAL
During the financial year, there was no issuance of new ordinary shares.
STATUTORY INFORMATION REGARDING THE GROUP AND THE COMPANY
(a) As at the end of the financial year
(i) Before the financial statements of the Group and of the Company were prepared, the Directors took reasonable steps:
• to ascertain that proper action had been taken in relation to the writing off of bad debts and financing and the
making of provision for doubtful debts and financing and had satisfied themselves that all known bad debts and
financing had been written off and that adequate provision had been made for doubtful debts and financing; and
• to ensure that any current assets, which were unlikely to be realised in the ordinary course of business including the
value of current assets as shown in the accounting records of the Group and of the Company had been written down
to an amount which the current assets might be expected so to realise.
(ii) In the opinion of the Directors, the results of the operations of the Group and the Company during the financial year had
not been substantially affected by any item, transaction or event of a material and unusual nature.
(b) From the end of the financial year to the date of this report
(i) The Directors are not aware of any circumstances:
• which would render the amount written off for bad debts and financing or the amount of the provision for doubtful
debts and financing in the financial statements of the Group and the Company, inadequate to any substantial extent;
• which would render the values attributed to current assets in the financial statements of the Group and of the
Company misleading; and
• which have arisen which would render adherence to the existing method of valuation of assets or liabilities of the
Group and of the Company misleading or inappropriate.
118 • FINANCIALS
Directors’ Report
STATUTORY INFORMATION REGARDING THE GROUP AND THE COMPANY (continued)
(b) From the end of the financial year to the date of this report (continued)
(ii) In the opinion of the Directors:
• the results of the operations of the Group and of the Company for the financial year ended 30 June 2023 are unlikely
to be substantially affected by any item, transaction or event of a material and unusual nature which had arisen in
the interval between the end of the financial year and the date of this report; and
• no contingent or other liability of any company in the Group has become enforceable, or is likely to become
enforceable, within the period of twelve months after the end of the financial year which will or may affect the
ability of the Group and the Company to meet their obligations as and when they fall due.
(c) As at the date of this report
(i) There are no charges on the assets of the Group and the Company which had arisen since the end of the financial year to
secure the liabilities of any other person.
(ii) There are no contingent liabilities which had arisen since the end of the financial year.
(iii) The Directors are not aware of any circumstances not otherwise dealt with in the report or financial statements of the
Group and of the Company which would render any amount stated in the financial statements misleading.
DISCLOSURE OF SHARIAH ADVISORY COMMITTEE
The Group’s Islamic banking and takaful business activities are subject to compliance with Shariah governance guided by the Shariah
Committee consisting of 5 members, appointed by the Board of Directors of Hong Leong Islamic Bank Berhad and Hong Leong MSIG
Takaful Berhad, and approved by Bank Negara Malaysia.
The primary role of the Shariah Advisory Committee is mainly advising on matters relating to the business operations and products
of the Group and providing support by attending regular meetings with the Group to ensure that they are in conformity with Shariah
principles.
ULTIMATE HOLDING COMPANY
The ultimate holding company is Hong Leong Company (Malaysia) Berhad, a company incorporated in Malaysia.
SUBSIDIARIES
Details of subsidiary companies are set out in Note 11 to the financial statements.
Directors’ Report
DIRECTORS’ REMUNERATION
The remuneration in aggregate for Directors of the Company and its subsidiaries for the financial year are as follows:

RM’000 RM’000
Directors of the Company

Director fees 1,105 815
Directors' other emoluments 11,642 11,566
Directors of the Company's Subsidiaries

Director fees 5,181 -
Directors' other emoluments 12,718 -
There was no amount paid to or receivable by any third party for services provided by Directors of the Company and its subsidiaries.
Directors and Officers of the Group are covered under the Directors’ & Officers’ Liability Insurance in respect of liabilities arising from
acts committed in their respective capacity as, inter alia, Directors and Officers of the Group subject to the terms of the policy. The
total amount of Directors’ & Officers’ Liability Insurance effected for the Directors & Officers of the Group was RM10 million. The total
amount of premium paid for the Directors’ & Officers’ Liability Insurance by the Group was RM71,250 and the apportioned amount of
the said premium paid by the Company was RM3,563.
Details of Directors’ remuneration are set out in Note 41 to the financial statements.
AUDITORS’ REMUNERATION
Auditors’ remuneration of the Group and the Company are RM9,116,546 and RM587,830 respectively.
Details of auditors’ remuneration are set out in Note 38 to the financial statements.
AUDITORS
The auditors, PricewaterhouseCoopers PLT (LLP0014401-LCA & AF 1146), have expressed their willingness to accept re-appointment
as auditors.
Signed on behalf of the Board of Directors in accordance with their resolution dated 20 September 2023.
TAN KONG KHOON HO HENG CHUAN

Director Director
Kuala Lumpur
20 September 2023
120 • FINANCIALS

as at 30 June 2023

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Assets
Cash and short-term funds 2 9,848,432 9,605,894 65,246 26,609
Deposits and placements with banks and other financial
institutions 3 1,079,574 1,300,746 67,860 3,360
Financial assets at fair value through profit or loss 4 31,893,892 29,470,629 - -
Financial investments at fair value through other
comprehensive income 5 35,724,785 27,452,943 - -
Financial investments at amortised cost 6 32,332,303 33,608,857 - -
Derivative financial instruments 21 2,235,614 1,902,169 - -
Loans, advances and financing 7 180,567,415 167,177,303 - -
Clients’ and brokers’ balances 8 618,824 722,181 - -
Other assets 9 2,677,749 2,431,500 2,250 2,635
Statutory deposits with Central Banks 10 3,449,270 520,650 - -
Tax recoverable 4,907 6,262 464 492
Investment in subsidiary companies 11 - - 18,558,876 19,459,428
Investment in associated companies 12 10,050,740 7,660,825 - -
Deferred tax assets 24 107,874 364,931 203 229
Property and equipment 13 1,214,879 1,274,380 5,341 4,803
Right-of-use assets 14 189,340 214,355 3,135 4,075
Investment properties 15 471,630 471,610 - -
Goodwill arising on consolidation 16 2,410,644 2,410,644 - -
Intangible assets 17 387,918 324,938 137 76
Total assets 315,265,790 286,920,817 18,703,512 19,501,707
The accompanying accounting policies and notes form an integral part of these financial statements

as at 30 June 2023

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Liabilities
Deposits from customers 18 211,467,443 197,382,921 - -
Investment accounts of customers 19 2,250,513 2,668,408 - -
Deposits and placements of banks and other financial
institutions 20 12,452,060 8,229,485 - -
Obligations on securities sold under repurchase
agreements 7,399,583 3,971,304 - -
Bills and acceptances payable 211,431 241,361 - -
Derivative financial instruments 21 2,447,431 1,765,006 - -
Clients’ and brokers’ balances 145,393 306,901 - -
Other liabilities 22 12,054,456 12,001,014 14,775 14,868
Lease liabilities 23 192,011 212,599 3,353 4,249
Recourse obligations on loans/financing sold to Cagamas
Berhad 2,972,220 1,623,936 - -
Provision for claims 414,347 338,005 - -
Provision for taxation 58,141 331,101 - -
Borrowings 25 201,936 411,931 201,919 411,858
Subordinated obligations 26 2,206,650 2,207,083 1,101,859 1,601,624
Multi-currency Additional Tier 1 capital securities 27 1,719,630 1,715,849 404,851 806,431
Insurance funds 28 19,442,911 17,524,189 - -
Total liabilities 275,636,156 250,931,093 1,726,757 2,839,030
Equity attributable to owners of the parent

Share capital 29 2,267,008 2,267,008 2,267,008 2,267,008
Reserves 30 24,757,812 22,244,622 14,884,472 14,573,325
Treasury shares for ESS 31 (233,108) (236,039) (174,725) (177,656)
26,791,712 24,275,591 16,976,755 16,662,677
Non-controlling interests 12,837,922 11,714,133 - -
Total equity 39,629,634 35,989,724 16,976,755 16,662,677
Total equity and liabilities 315,265,790 286,920,817 18,703,512 19,501,707
Commitments and contingencies 45 269,008,810 214,693,156 - -
122 • FINANCIALS

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Interest income 32 7,549,032 5,672,747 100,780 110,792

Interest income for financial assets at fair value through
profit or loss 33 214,224 270,941 - -
Interest expense 34 (3,977,251) (2,087,184) (108,870) (127,679)
Net interest income/(expense) 3,786,005 3,856,504 (8,090) (16,887)
Income from Islamic banking business 35 963,368 904,785 - -
4,749,373 4,761,289 (8,090) (16,887)
Non-interest income 37 1,679,797 1,490,227 896,975 830,274
6,429,170 6,251,516 888,885 813,387
Overhead expenses 38 (2,569,627) (2,358,210) (32,309) (6,717)
Operating profit before allowances 3,859,543 3,893,306 856,576 806,670
Allowance for impairment losses on loans, advances and
financing and other losses 39 (115,208) (163,117) - -
Writeback of impairment losses on other assets 40 304 1,031 1,514 1,253
3,744,639 3,731,220 858,090 807,923
Share of results of associated companies 12 1,357,741 1,108,759 - -
Profit before taxation 5,102,380 4,839,979 858,090 807,923
Taxation 42 (894,761) (1,157,118) (208) (251)
Net profit for the financial year 4,207,619 3,682,861 857,882 807,672
Attributable to:
Owners of the parent 2,791,303 2,452,209 857,882 807,672
Non-controlling interests 1,416,316 1,230,652 - -
4,207,619 3,682,861 857,882 807,672
Earnings per share attributable to equity holders of

the Company (sen)
- Basic/diluted 43 246.1 216.3 75.4 71.0
Statements of Comprehensive Income


2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Net profit for the financial year 4,207,619 3,682,861 857,882 807,672
Other comprehensive income/(loss):
Items that will not be reclassified to profit or loss:
Equity instruments at fair value through other
comprehensive income
- Net fair value changes 14,264 14,286 - -
Items that may be reclassified subsequently to profit or
loss:
Currency translation differences 81,305 236,815 - -
Share of other comprehensive loss of associated
companies (11,133) (29,506) - -
Net fair value changes in cash flow hedge 362 7,574 - -
Debt instruments at fair value through other
- Net fair value changes 426,539 (1,191,736) - -
- Changes in expected credit losses 294 (751) - -
Income tax relating to components of other
comprehensive (loss)/income 57 (93,151) 259,268 - -
Other comprehensive income/(loss) for the financial year,
net of tax 418,480 (704,050) - -
Total comprehensive income for the financial year,
net of tax 4,626,099 2,978,811 857,882 807,672
Attributable to:
Owners of the parent 3,074,512 1,987,685 857,882 807,672
Non-controlling interests 1,551,587 991,126 - -
4,626,099 2,978,811 857,882 807,672
124 • FINANCIALS
Statements of Changes in Equity

Attributable to owners of the parent

Fair Cash flow Share Exchange Treasury Non-
Share Regulatory value hedge Other options fluctuation Retained shares controlling Total
capital reserve* reserve reserve reserves reserve reserve profits for ESS Total interests equity
The Group Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
As at 1 July 2022 2,267,008 666,534 (541,311) (185) 213,314 60,866 907,614 20,937,790 (236,039) 24,275,591 11,714,133 35,989,724
Comprehensive income
Net profit for the financial year - - - - - - - 2,791,303 - 2,791,303 1,416,316 4,207,619
Currency translation differences - - - - - - 59,718 - - 59,718 21,587 81,305
Share of other comprehensive income of associated
companies - - (5,944) - - - - - - (5,944) (5,189) (11,133)
Financial investments measured at fair value through other
- Equity instruments
- Net fair value changes - - 9,344 - - - - - - 9,344 4,920 14,264
- Debt instruments
- Changes in expected credit losses - - 193 - - - - - - 193 101 294
Net fair value changes in cash flow hedge - - - 185 - - - - - 185 94 279
Total comprehensive income - - 223,306 185 - - 59,718 2,791,303 - 3,074,512 1,551,587 4,626,099


Transaction with owners

Transfer to regulatory reserve - 349,956 - - - - - (349,956) - - - -
Allocation of other reserves to non-controlling interests - - - - - - - 999 - 999 (999) -
Dividends paid:
- final dividend for the financial year ended 30 June 2022 44 - - - - - - - (352,792) - (352,792) - (352,792)
- interim dividend for the financial year ended 30 June
2023 44 - - - - - - - (193,493) - (193,493) - (193,493)
Non-controlling interests share of dividend - - - - - - - - - - (431,723) (431,723)
Non-controlling interests share of subsidiary’s treasury shares - - - - - - - - - - 4,924 4,924
Options charge arising from executive share scheme - - - - - (10,144) - - - (10,144) - (10,144)
Exercise of executive share scheme - - - - - (15,220) - 9,328 2,931 (2,961) - (2,961)
Total transaction with owners - 349,956 - - - (25,364) - (885,914) 2,931 (558,391) (427,798) (986,189)
As at 30 June 2023 2,267,008 1,016,490 (318,005) - 213,314 35,502 967,332 22,843,179 (233,108) 26,791,712 12,837,922 39,629,634
126 • FINANCIALS


As at 1 July 2021 2,267,008 437,103 85,375 (3,959) 213,314 96,305 749,226 19,213,037 (238,970) 22,818,439 11,114,999 33,933,438
Comprehensive income
Net profit for the financial year - - - - - - - 2,452,209 - 2,452,209 1,230,652 3,682,861
Currency translation differences - - - - - - 158,388 - - 158,388 78,427 236,815
Share of other comprehensive income of associated
companies - - (23,735) - - - - - - (23,735) (5,771) (29,506)
Financial investments measured at fair value through other
- Equity instruments
- Debt instruments
- Net fair value changes - - (611,803) - - - - - - (611,803) (318,849) (930,652)
- Changes in expected credit losses - - (510) - - - - - - (510) (241) (751)
Net fair value changes in cash flow hedge - - - 3,774 - - - - - 3,774 1,984 5,758
Total comprehensive (loss)/income - - (626,686) 3,774 - - 158,388 2,452,209 - 1,987,685 991,126 2,978,811


Transaction with owners

Transfer to regulatory reserve - 229,431 - - - - - (229,431) - - - -
Allocation of other reserves to non-controlling interests - - - - - - - (4,503) - (4,503) 4,503 -
Dividends paid:
- final dividend for the financial year ended 30 June 2021 44 - - - - - - - (332,261) - (332,261) - (332,261)
- interim dividend for the financial year ended 30 June
2022 44 - - - - - - - (170,706) - (170,706) - (170,706)
Non-controlling interests share of dividend - - - - - - - - - (401,835) (401,835)
Non-controlling interests share of subsidiary’s treasury shares - - - - - - - - - - 5,340 5,340
Options charge arising from executive share scheme - - - - - (20,447) - - - (20,447) - (20,447)
Exercise of executive share scheme - - - - - (14,992) - 9,445 2,931 (2,616) - (2,616)
Total transaction with owners - 229,431 - - - (35,439) - (727,456) 2,931 (530,533) (391,992) (922,525)
As at 30 June 2022 2,267,008 666,534 (541,311) (185) 213,314 60,866 907,614 20,937,790 (236,039) 24,275,591 11,714,133 35,989,724
* Comprise regulatory reserves maintained by the Group’s banking subsidiary companies in Malaysia of RM1,005,245,000 (2022: RM655,289,000) in accordance with BNM’s Policy Document on Classification
and Impairment Provisions for Loans/Financing and the banking subsidiary company in Vietnam with the State Bank of Vietnam of RM11,245,000 (2022: RM11,245,000).
128 • FINANCIALS

Non-distributable Distributable
Other Share Treasury
Share capital options shares Retained Total
capital reserve reserve for ESS profits equity
The Company Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
As at 1 July 2022 2,267,008 254,991 2,685 (177,656) 14,315,649 16,662,677

Net profit for the financial year - - - - 857,882 857,882
Dividends paid
- final dividend for the financial
year ended 30 June 2022 44 - - - - (352,792) (352,792)
- interim dividend for the
financial year ended 30 June
2023 44 - - - - (193,493) (193,493)
Options charge arising from
executive share scheme - - 2,481 - - 2,481
Exercise of executive share
scheme - - (2,870) 2,931 (61) -
As at 30 June 2023 2,267,008 254,991 2,296 (174,725) 14,627,185 16,976,755
As at 1 July 2021 2,267,008 254,991 24,215 (180,587) 14,011,005 16,376,632

Net profit for the financial year - - - - 807,672 807,672
Dividends paid
- final dividend for the financial
year ended 30 June 2021 44 - - - - (332,261) (332,261)
- interim dividend for the
financial year ended 30 June
2022 44 - - - - (170,706) (170,706)
Options charge arising from
executive share scheme - - (18,660) - - (18,660)
Exercise of executive share
scheme - - (2,870) 2,931 (61) -
As at 30 June 2022 2,267,008 254,991 2,685 (177,656) 14,315,649 16,662,677
Statements of Cash Flows

The Group
2023 2022
RM’000 RM’000
Cash flows from operating activities

Profit before taxation 5,102,380 4,839,979
Adjustments for:
Unearned premium reserves and underwriting surplus - 181,192
Depreciation of property and equipment 120,327 130,105
Depreciation of right-of-use assets 49,862 50,518
Amortisation of intangible assets 64,223 59,027
Intangible assets written off 2,607 738
Property and equipment written off 1,182 729
Net gain on disposal of property and equipment (387) (1,745)
Net realised (gain)/loss from disposal of financial assets at fair value through profit or loss (94,925) 61,771
Net realised gain from disposal of financial investments at fair value through other
comprehensive income (38,769) (81,523)
Net realised loss/(gain) arising from derivative financial instruments 21,619 (56,192)
Net unrealised gain on revaluation of financial assets at fair value through profit or loss and
derivative financial instruments (137,528) (232,674)
Net realised (gain)/loss on fair value changes arising from fair value hedges (7,371) 8,454
Net (gain)/loss arising from fair value hedges (1,169) 3,202
Writeback of impairment losses on financial investments (304) (1,031)
Allowances for impairment losses on loans, advances and financing and other losses 342,954 393,124
Impaired loans, advances and financing written off 29,519 20,054
Interest expense on borrowings 8,221 14,269
Interest expense on subordinated obligations 94,788 94,439
Interest expense on Multi-currency Additional Tier 1 capital securities 81,755 47,102
Interest expense on recourse obligations on loans/financing sold to Cagamas Berhad 77,410 44,702
Interest expense on lease liabilities 8,708 8,750
Interest income from financial assets at fair value through profit or loss (214,224) (270,941)
Interest income from financial investments at fair value through other comprehensive income (919,899) (709,819)
Interest income from financial investments at amortised cost (702,552) (653,131)
Dividend income from financial assets at fair value through profit or loss and financial
investments at fair value through other comprehensive income (92,390) (73,602)
Share option expenses (10,144) (20,447)
Surplus transferred from life insurance business (313,298) (382,152)
Share of results of associated companies (1,357,741) (1,108,759)
(2,987,526) (2,473,840)
Operating profit before working capital changes 2,114,854 2,366,139
130 • FINANCIALS

The Group
2023 2022
RM’000 RM’000
Decrease/(increase) in operating assets

Cash and short-term funds and deposits and placements with banks and other financial
institutions with original maturity of more than three months 250,411 3,866,226
Financial assets at fair value through profit or loss (2,088,178) (876,872)
Loans, advances and financing (13,768,628) (12,842,098)
Derivative financial instruments (544,012) (1,126,725)
Clients’ and brokers’ balances 103,357 (195,400)
Other assets (1,101,896) (321,616)
Statutory deposits with Central Banks (2,928,620) (27,045)
Increase/(decrease) in operating liabilities

Deposits from customers 14,397,573 15,974,407
Investment accounts of customers (417,895) 1,523,254
Deposits and placements of banks and other financial institutions 4,222,575 (5,949,976)
Obligations on securities sold under repurchase agreements 3,428,279 3,228,554
Derivative financial instruments 682,731 794,055
Bills and acceptances payable (29,929) 51,719
Other liabilities 35,718 (5,167,635)
Provision for claims 76,342 90,639
Clients’ and brokers’ balances (161,508) 99,718
Insurance funds 2,240,857 -
4,396,637 (878,795)
Cash generated from operating activities 6,511,491 1,487,344
Income tax paid (1,113,205) (1,148,369)
Interest received 2,858 562
(1,110,347) (1,147,807)
Net cash generated from operating activities 5,401,144 339,537
Cash flows from investing activities

Net (purchases)/disposal of financial investments at fair value through other comprehensive income (7,885,535) 7,507,960
Net disposal/(purchases) of financial investments at amortised cost 1,276,607 (8,914,664)
Interest received on financial investments at fair value through other comprehensive income
and financial investments at amortised cost 1,622,450 1,362,950
Dividends received on financial assets at fair value through profit or loss and financial
investments at fair value through other comprehensive income 92,391 73,602
Dividends received from associated companies 39,977 79,954
Net proceeds from disposal of property and equipment 545 2,088
Purchase of property and equipment (147,577) (136,582)
Purchase of intangible assets (41,863) (41,382)
Net cash used in investing activities (5,043,005) (66,074)

The Group
2023 2022
Note RM’000 RM’000
Cash flows from financing activities

Interest paid on subordinated obligations (95,221) (94,535)
Interest paid on borrowings (8,216) (17,364)
Interest paid on Multi-currency Additional Tier 1 capital securities (81,755) (40,142)
Interest paid on recourse obligations on loans/financing sold to Cagamas Berhad (66,196) (40,431)
Interest paid on lease liabilities (8,708) (8,750)
Repayment of revolving credit (100,000) (25,000)
Repayment of commercial papers (110,000) (46,000)
Repayment of term loans - (1,000)
Repayment of lease liabilities (47,392) (46,659)
Repayment of Multi-currency Additional Tier 1 capital securities (400,000) -
Repayment of subordinated obligations (500,000) -
Repayment of senior notes - (175,000)
Repayment of recourse obligations on loans/financing sold to Cagamas Berhad (962,930) (64,174)
Proceeds from subordinated obligations 500,000 -
Proceeds from Multi-currency Additional Tier 1 capital securities 400,000 900,000
Proceeds from recourse obligations on loans/financing sold to Cagamas Berhad 2,300,000 650,000
Cash received from ESS exercised - 916
Dividends paid to
- owners of the parent (546,285) (502,967)
- non-controlling interest (431,723) (401,835)
Net cash (used in)/generated from financing activities (158,426) 87,059
Net increase in cash and cash equivalents 199,713 360,522

Effects of exchange rate changes 72,064 291,160
Cash and cash equivalents at beginning of financial year 9,844,724 9,193,042
Cash and cash equivalents at end of financial year 10,116,501 9,844,724
Analysis of cash and cash equivalents

Cash and short-term funds 2 9,848,432 9,605,894
Deposits and placements with banks and other financial institutions 3 1,079,574 1,300,746
10,928,006 10,906,640
Less: deposits and placements with banks and other financial institutions with original
maturity of more than three months (811,505) (1,061,916)
10,116,501 9,844,724
132 • FINANCIALS

The Company
2023 2022
RM’000 RM’000
Cash flows from operating activities

Profit before taxation 858,090 807,923
Adjustments for:
Depreciation of property and equipment 1,201 760
Depreciation of right-of-use assets 940 940
Amortisation of intangible assets 75 39
Gain on disposal of property and equipment (113) (160)
Loss on disposal of financial assets at fair value through profit or loss - 38
Finance costs on lease liabilities 213 258
Writeback of impairment loss on investment in debt instruments issued by subsidiary companies (1,514) (1,253)
Interest expense 108,657 127,421
Interest income (100,780) (110,792)
Dividend income from financial assets at fair value through profit or loss - (193)
Dividend income from subsidiary companies (885,303) (820,911)
Share option expenses 2,481 (18,660)
(874,143) (822,513)
Operating loss before working capital changes (16,053) (14,590)
Decrease/(increase) in operating assets

Other assets 386 (664)
Financial assets at fair value through profit or loss - (38)
Decrease in operating liabilities
Other liabilities (124) (2,189)
262 (2,891)
Cash used in operating activities (15,791) (17,481)
Income tax (paid)/refund (154) 9,847
Interest received 2,858 562
2,704 10,409
Net cash used in operating activities (13,087) (7,072)

The Company
2023 2022
Cash flows from investing activities

Dividends received from other investments - 193
Dividends received from subsidiary companies 885,303 820,911
Net proceeds from disposal of property and equipment 113 160
Purchase of property and equipment (1,739) (2,374)
Purchase of intangible assets (136) (8)
Proceeds from Multi-currency Additional Tier 1 capital securities 400,000 -
Proceeds from subordinated obligations 500,000 -
Interest received from investment in debt instruments issued by subsidiary companies
- Multi-currency Additional Tier 1 capital securities 29,224 39,344
- Subordinated obligations 70,763 70,963
Net cash generated from investing activities 1,883,528 929,189
Cash flows from financing activities

Interest paid on borrowings (8,216) (17,833)
Interest paid on Multi-currency Additional Tier 1 capital securities (29,826) (40,142)
Interest paid on subordinated obligations (71,882) (72,086)
Interest paid on lease liabilities (199) (244)
Repayment of Multi-currency Additional Tier 1 capital securities (400,000) -
Repayment of subordinated obligations (500,000) -
Repayment of revolving credit (100,000) (25,000)
Repayment of commercial papers (110,000) (46,000)
Repayment of senior notes - (200,000)
Repayment of term loans - (1,000)
Repayment of lease liabilities (896) (850)
Dividends paid to shareholders (546,285) (502,967)
Net cash used in financing activities (1,767,304) (906,122)
Net increase in cash and cash equivalents 103,137 15,995

Cash and cash equivalents at beginning of financial year 26,669 10,674
Cash and cash equivalents at end of financial year 129,806 26,669
Analysis of cash and cash equivalents

Cash and short-term funds 2 65,246 26,609
Deposits and placements with banks and other financial institutions 3 67,860 3,360
133,106 29,969
Less: deposits and placements with banks and other financial institutions with original
maturity of more than three months (3,300) (3,300)
129,806 26,669
134 • FINANCIALS

Analysis of changes in liabilities arising from financing activities as follows:
Recourse
obligations
on loans/ Multi-currency
financing Additional
sold to Tier 1
Cagamas Subordinated capital Lease
Berhad Borrowings obligations securities liabilities
The Group RM’000 RM’000 RM’000 RM’000 RM’000
2023
As at 1 July 1,623,936 411,931 2,207,083 1,715,849 212,599
Proceeds 2,300,000 - 500,000 400,000 -
Repayments (962,930) (210,000) (500,000) (400,000) (47,392)
Interest paid (66,196) (8,216) (95,221) (81,755) (8,708)
Accrued interest 77,410 8,205 93,961 83,358 8,708
Amortisation - 16 827 345 -
Other non-cash - - - 1,833 26,804
As at 30 June 2,972,220 201,936 2,206,650 1,719,630 192,011
2022
As at 1 July 1,033,839 662,026 2,207,179 806,555 204,872
Proceeds 650,000 - - 900,000 -
Repayments (64,174) (247,000) - - (46,659)
Interest paid (40,431) (17,364) (94,535) (40,142) (8,750)
Accrued interest 44,702 14,244 94,400 47,112 8,750
Amortisation - 25 39 (958) -
Other non-cash - - - 3,282 54,386
As at 30 June 1,623,936 411,931 2,207,083 1,715,849 212,599

Analysis of changes in liabilities arising from financing activities as follows: (continued)
Multi-currency
Additional
Tier 1
Subordinated capital Lease
Borrowings obligations securities liabilities
The Company RM’000 RM’000 RM’000 RM’000
2023
As at 1 July 411,859 1,601,624 806,431 4,249
Repayments (210,000) (500,000) (400,000) (896)
Interest paid (8,216) (71,882) (29,826) (199)
Accrued interest 8,220 71,612 27,992 199
Amortisation 56 505 254 -
As at 30 June 201,919 1,101,859 404,851 3,353
2022
As at 1 July 687,361 1,601,242 805,975 5,099
Repayments (272,000) - - (850)
Interest paid (17,833) (72,086) (40,142) (244)
Accrued interest 14,269 71,950 40,200 244
Amortisation 62 518 398 -
As at 30 June 411,859 1,601,624 806,431 4,249
136 • FINANCIALS
Summary of Significant Accounting Policies

The following accounting policies have been used consistently in dealing with items that are considered material in relation to the
financial statements.
A BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS
The financial statements of the Group and the Company have been prepared in accordance with the Malaysian Financial
Reporting Standards (“MFRS”), International Financial Reporting Standards and the requirements of the Companies Act, 2016 in
Malaysia. The financial statements incorporate the activities relating to the Islamic banking and takaful businesses which have
been undertaken by its subsidiaries, Hong Leong Islamic Bank Berhad (“HLISB”) and Hong Leong MSIG Takaful Berhad (“HLMT”)
in compliance with Shariah principles. Islamic banking business refers generally to the acceptance of deposits and granting of
financing under Shariah principles while takaful business refers generally to underwriting of Islamic insurance under the Shariah
principles.
The financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial
investments at fair value through other comprehensive income and financial assets/financial liabilities at fair value through
profit or loss (including derivative financial instruments and revaluation of investment properties).
The preparation of financial statements in conformity with MFRS requires the use of certain critical accounting estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements, and the reported amounts of income and expenses during the reported financial year. It also
requires Directors to exercise their judgement in the process of applying the Group’s and the Company’s accounting policies.
Although these estimates and judgement are based on the management and Directors’ best knowledge of current events and
actions, actual results may differ from those estimates.
The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to
the financial statements are disclosed in Note 59.
(a) Standards, amendments to published standards and interpretations that are effective and applicable to the Group
and the Company
The Group and the Company have applied the following standards and amendments for the first time for the financial year
beginning on 1 July 2022:
• Amendments to MFRS 116 “Proceeds before Intended Use”
• Amendments to MFRS 137 “Onerous Contracts - Cost of Fulfilling a Contract”
• Annual improvements to MFRS 9 “Fees in the 10% test for derecognition of financial liabilities”
• Amendments to MFRS 3 “Business Combinations” - Reference to the Conceptual Framework
(i) Amendments to MFRS 116 “Proceeds before Intended Use”
The amendments prohibit an entity from deducting from the cost of a property, plant and equipment (“PPE”) the
proceeds received from selling items produced by the PPE before it is ready for its intended use. The sales proceeds
would have met the revenue definition and therefore should be recognised in statements of income.
The amendments also clarify that “testing” in MFRS 116 refers to assessing the technical and physical performance
of the PPE rather than its financial performance.
The amendments shall be applied retrospectively.


A BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS (continued)
(a) Standards, amendments to published standards and interpretations that are effective and applicable to the Group
and the Company (continued)
(ii) Amendments to MFRS 137 “Onerous Contracts – Cost of Fulfilling a Contract”
The amendments clarify that direct costs of fulfilling a contract include both the incremental cost of fulfilling the
contract as well as an allocation of other costs directly related to fulfilling contracts. The amendments also clarify
that before recognising a separate provision for an onerous contract, impairment loss that has occurred on assets
used in fulfilling the contract should be recognised.
(iii) Annual Improvements to MFRS 9 “Fees in the 10% test for derecognition of financial liabilities”
When entities restructure their loans with the existing lenders, MFRS 9 requires management to quantitatively
assess the significance of the difference between cash flows of the existing and new loans (commonly known as
the “10% test”).
This amendment to MFRS 9 clarifies that only fees paid or received between the borrower and the lender are
included in the 10% test. Any fees paid to third parties should be excluded. This amendment will impact the result
of the 10% test and accordingly affect the amount of gain or loss recognised in the income statements.
An entity shall apply the amendment to financial liabilities that are modified or exchanged on or after the beginning
of the annual reporting period in which the entity first applies the amendment.
(iv) Amendments to MFRS 3 “Business Combinations” - Reference to the Conceptual Framework
The amendments replace the reference to Framework for Preparation and Presentation of Financial Statements with
2018 Conceptual Framework. The amendments did not change the current accounting for business combinations on
acquisition date.
The amendments provide an exception for the recognition of liabilities and contingent liabilities should be
in accordance with the principles of MFRS 137 “Provisions, Contingent Liabilities and Contingent Assets” and IC
Interpretation 21 “Levies” when falls within their scope. It also clarifies that contingent assets should not be
recognised at the acquisition date.
The adoption of the annual improvements and amendments to published standards above did not have any impact on the
current period or any prior period and is not likely to affect future periods.
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(b) Standards, amendments to published standards and interpretations to existing standards that are applicable to
the Group and the Company but not yet effective
Financial year beginning on/after 1 July 2023
(i) Amendments to MFRS 101, MFRS Practice Statement 2 and MFRS 108 on “Disclosure of Accounting Policies” and
“Definition of Accounting Estimates” - effective 1 January 2023
Amendments on disclosure of accounting policies (Amendments to MFRS 101 and MFRS Practice Statement 2)
The amendments to MFRS 101 require companies to disclose material accounting policies rather than significant
accounting policies. Entities are expected to make disclosure of accounting policies specific to the entity and not
generic disclosures on MFRS applications. The amendment explains an accounting policy is material if, when
considered together with other information included in an entity’s financial statements, it can reasonably be
expected to influence decisions that the primary users of general purpose financial statements make on the basis
of those financial statements. Also, accounting policy information is expected to be material if, without it, the users
of the financial statements would be unable to understand other material information in the financial statements.
Accordingly, immaterial accounting policy information need not be disclosed. However, if it is disclosed, it should not
obscure material accounting policy information. MFRS Practice Statement 2 was amended to provide guidance on
how to apply the concept of materiality to accounting policy disclosures.
Amendments on definition of accounting estimates (Amendments to MFRS 108)
The amendments to MFRS 108, redefined accounting estimates as “monetary amounts in financial statements that
are subject to measurement uncertainty”. To distinguish from changes in accounting policies, the amendments
clarify that effects of a change in an input or measurement technique used to develop an accounting estimate is
a change in accounting estimate, if they do not arise from prior period errors. Examples of accounting estimates
include expected credit losses; net realizable value of inventory; fair value of an asset or liability; depreciation for
property, plant and equipment; and provision for warranty.
(ii) Amendments to MFRS 112 “Deferred Tax related to Assets and Liabilities arising from a Single Transaction” - effective
1 January 2023
The amendments clarify that the initial exemption rule does not apply to transactions where both an asset and a
liability are recognized at the same time such as leases and decommissioning obligations. Accordingly, entities are
required to recognize both deferred tax assets and liabilities for all deductible and taxable temporary differences
arising from such transactions.
(iii) MFRS 17 “Insurance Contracts” and its amendments – effective 1 January 2023
Expected recovery of insurance acquisition cash flows
An entity is required to allocate part of the acquisition costs to related expected contract renewals, and to recognise
those costs as an asset until the entity recognises the contract renewals. Entities are required to assess the
recoverability of the asset at each reporting date, and to provide specific information about the asset in the notes to
the financial statements.

the Group and the Company but not yet effective (continued)
Financial year beginning on/after 1 July 2023 (continued)
(iii) MFRS 17 “Insurance Contracts” and its amendments – effective 1 January 2023 (continued)
Reinsurance contracts held - recovery of losses
When an entity recognises a loss on initial recognition of an onerous group of underlying insurance contracts, it
should adjust the contractual service margin of a related group of reinsurance contracts held and recognise a gain
on the reinsurance contracts held. The amount of the loss recovered from a reinsurance contract held is determined
by multiplying the loss recognised on the underlying insurance contracts and the % of claims on the underlying
insurance contracts that the entity expects to recover from the reinsurance contract held. This requirement would
apply only when the reinsurance contract held is recognised before or at the same time as the loss is recognised on
the underlying insurance contracts.
Contractual service margin attributable to investment services
The amendment requires an entity that issues insurance contracts without direct participation features to recognise
profit when it provides insurance coverage or any service relating to investment activities. Coverage units should
be identified, considering the quantity of benefits and expected period of both insurance coverage and investment
services, for contracts under the variable fee approach and for other contracts with an “investment-return service”
under the general model. Costs related to investment activities should be included as cash flows within the boundary
of an insurance contract, to the extent that the entity performs such activities to enhance benefits from insurance
coverage for the policyholders.
Other amendments include the following:
(i) Scope exclusions for some credit card (or similar) contracts, and some loan contracts.
(ii) Presentation of insurance contract assets and liabilities in the statement of financial position in portfolios
instead of groups (sub-portfolio) level.
(iii) Entities are also allowed to apply the risk migration option when mitigating financial risks using reinsurance
contracts held and non-derivative financial instruments at fair value through profit or loss.
(iv) An accounting policy choice to change the estimate made in previous interim financial statements when
applying MFRS 17.
(v) Other minor amendments.
(iv) Amendment to MFRS 17 “Initial Application of MFRS 17 and MFRS 9 - Comparative Information” – effective 1 January
2023
This amendment relates to the classification of comparative information of financial assets on initial application of
MFRS 17 (known as “classification overlay”). The objective of the amendment is to provide an optional transition
provision to reduce the one-time accounting mismatch on comparative information between insurance contract
liabilities and related financial assets.
140 • FINANCIALS

(iv) Amendment to MFRS 17 “Initial Application of MFRS 17 and MFRS 9 - Comparative Information” – effective 1 January
2023 (continued)
The amendment would be available for:
(i) any financial assets, including those held in respect of an activity that is unconnected to contracts within the
scope of MFRS 17;
(ii) entities that initially apply MFRS 9 at the same time as they apply MFRS 17; and
(iii) entities that had already applied MFRS 9 before the initial application of MFRS 17 where those entities
redesignate financial assets applying paragraph C29 of MFRS 17.
The transition option would:
(i) be available, on an instrument-by-instrument basis;
(ii) allow an entity to present comparative information as if the classification and measurement requirements of
MFRS 9 had been applied to that financial asset, but not require an entity to apply the impairment requirements
of MFRS 9.
Any difference in the carrying amount of the financial asset at the transition date resulting from applying the
classification overlay would be recognised in opening retained earnings (or other component of equity, as
appropriate) at that date.
(iii) require an entity that applies the classification overlay to a financial asset to use reasonable and supportable
information available at the transition date to determine how the entity expects that financial asset to be
classified applying MFRS 9.
The adoption of the accounting standards, amendments to published standards and interpretations to existing
standards that are applicable to the Group but not yet effective above are not expected to give rise to any material
financial impact to the Group. For the adoption of MFRS 17, the Group will apply the transitional provision and restate
comparative information for 2023. The Group has yet to finalise the financial impact of the adoption of MFRS 17 and
are now progressing with the implementation of the identified changes.
Financial year beginning on/after 1 July 2024
(i) Amendments to MFRS 16 “Lease Liability in a Sale and Leaseback” – effective 1 January 2024
The amendments specify that the measurement of the lease liability arises in a sale and lease back transaction
which satisfies the requirements in MFRS 15 “Revenue from Contracts with Customers” to be accounted for as a
sale. In accordance with the amendments, the seller-lessee shall determine the “lease payments” or “revised lease
payments” in a way that it does not result in the seller-lessee recognising any amount of the gain or loss that relates
to the right of use it retains.

(i) Amendments to MFRS 16 ”Lease Liability in a Sale and Leaseback” – effective 1 January 2024 (continued)
The amendments shall be applied retrospectively to sale and leaseback transactions entered into after the date
when the seller-lessee initially applied MFRS 16.
The adoption of the accounting standards, amendments to published standards and interpretations to existing standards
that are applicable to the Group but not yet effective above are not expected to give rise to any material financial impact
to the Group.
B Consolidation
(i) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity
when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to
affect those returns through its power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from
the date on which control is transferred to the Group and are de-consolidated from the date control ceases.
The consolidated financial statements include the financial statements of the Company and all its subsidiaries made up to
the end of the financial year.
The Group applies the acquisition method to account for business combinations.
The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities
incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred
includes the fair value of any asset or liability resulting from a contingent consideration arrangement and fair value of any
pre-existing equity interest in the subsidiary. Identifiable assets acquired and liabilities and contingent liabilities assumed
in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. The
Group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or
at the non-controlling interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-
date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets acquired is
recognised as goodwill. If the total of consideration transferred, non-controlling interest recognised and previously held
interest measured is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase,
the difference is recognised directly in the statements of income.
Acquisition-related costs are expensed as incurred.
If the business combination is achieved in stages, carrying value of the acquirer’s previously held equity interest in the
acquiree is remeasured to fair value at the acquisition date, any gains or losses from such remeasurement are recognised
in the statements of income.
142 • FINANCIALS

B CONSOLIDATION (continued)
(i) Subsidiaries (continued)
Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance
with MFRS 9 in the statements of income. Contingent consideration that is classified as equity is not remeasured, and its
subsequent settlement is accounted for within equity.
The Group applies predecessor accounting to account for business combinations under common control. Under predecessor
accounting, assets and liabilities acquired are not restated to their respective fair values. They are recognised at the
carrying amounts from the consolidated financial statements of the ultimate holding company of the Group and adjusted
to conform with the accounting policies adopted by the Group. The difference between any consideration given and
the aggregate carrying amounts of the assets and liabilities (as of the date of the transaction) of the acquired entity is
recognised as an adjustment to equity. No additional goodwill is recognised.
The acquirer only incorporates the acquired entity’s results and statements of financial position prospectively from the
date on which the business combination between entities under common control occurred. Consequently, the consolidated
financial statements do not reflect the results of the acquired entity for the period before the transaction occurred. The
corresponding amounts for the previous financial year are also not restated.
Predecessor accounting may lead to a difference between the cost of the transaction and the carrying value of the net
assets. The difference is recorded in retained profits.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transfer assets.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted
by the Group.
Non-controlling interest in the results and equity of subsidiaries are shown separately in the consolidated statements
of income, statements of comprehensive income, statements of changes in equity and statements of financial position
respectively.
The Group has consolidated the investment funds that it controls in accordance with MFRS 10 “Consolidated Financial
Statements”. The third party interest of the funds is recorded as a financial liability in accordance with accounting policy
Note F.
(ii) Changes in ownership interests in subsidiaries without change of control
Transactions with non-controlling interests that do not result in loss of control are accounted for as transactions with
equity owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of
the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between
the amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in equity
attributable to owners of the Group.

(iii) Disposal of subsidiaries
When the Group ceases to consolidate because of loss of control, any retained interest in the entity is remeasured to its
fair value at the date when control is lost, with the change in carrying amount recognised in statements of income. The fair
value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate,
joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect
of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that
amounts previously recognised in other comprehensive income are reclassified to statements of income.
Gains and losses of the disposal of subsidiaries include the carrying amount of goodwill relating to the subsidiaries sold.
(iv) Joint arrangements
A joint arrangement is an arrangement of which there is contractually agreed sharing of control by the Group with one or
more parties, where decisions about the relevant activities relating to the joint arrangement require unanimous consent
of the parties sharing control. The classification of a joint arrangement as a joint operation or a joint venture depends
upon the rights and obligations of the parties to the arrangement. A joint venture is a joint arrangement whereby the joint
venturers have rights to the net assets of the arrangement. A joint operation is a joint arrangement whereby the joint
operators have rights to the assets and obligations for the liabilities, relating to the arrangement.
The Group’s interests in joint venture is accounted for using the equity method, after initially being recognised at cost in
the consolidated statement of financial position. Under the equity method, the investment in a joint venture is initially
recognised at cost, and adjusted thereafter to recognise the Group’s share of the post-acquisition profits or losses of the
joint venture in profit or loss, and the Group’s share of movements in other comprehensive income of the joint venture in
other comprehensive income. Dividends received or receivable from a joint venture are recognised as a reduction in the
carrying amount of the investment. When the Group’s share of losses in a joint venture equals or exceeds its interests
in the joint venture, including any long-term interests that, in substance, form part of the Group’s net investment in the
joint venture, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made
payments on behalf of the joint venture.
The Group determines at each reporting date whether there is any objective evidence that the investment in the joint
venture is impaired. An impairment loss is recognised for the amount by which the carrying amount of the joint venture
exceeds its recoverable amount. The Group presents the impairment loss adjacent to ”share of results of joint venture” in
the statements of income.
Unrealised gains on transactions between the Group and its joint venture is eliminated to the extent of the Group’s interest
in the joint venture. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of
the asset transferred. Accounting policies of the joint venture have been changed where necessary to ensure consistency
with the policies adopted by the Group.
If the ownership interest in a joint venture is reduced but joint control is retained, only a proportionate share of the
amounts previously recognised in other comprehensive income is reclassified to statements of income where appropriate.
144 • FINANCIALS

(v) Associated companies
Associates are all entities over which the Group has significant influence but not control or joint control, generally
accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for
using the equity method of accounting. Under the equity method, the investment in an associate is initially recognised
at cost, and adjusted thereafter to recognise the Group’s share of the post-acquisition profits or losses of the associate
in statements of income, and the Group’s share of movements in other comprehensive income of the associate in other
comprehensive income. Dividends received or receivable from an associate are recognised as a reduction in the carrying
amount of the investment. When the Group’s share of losses in an associate equals or exceeds its interests in the associate,
including any long-term interests that, in substance, form part of the Group’s net investment in the associate, the Group
does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of
the associate. The Group’s investment in associates includes goodwill identified on acquisition.
The Group determines at each reporting date whether there is any objective evidence that the investment in the associate
is impaired. An impairment loss is recognised for the amount by which the carrying amount of the associate exceeds its
recoverable amount. The Group presents the impairment loss adjacent to “share of results of associated company” in the
statements of income.
Profits and losses resulting from upstream and downstream transactions between the Group and its associate are recognised
in the Group’s financial statements only to the extent of unrelated investor’s interests in the associates. Unrealised losses
are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of
associates have been changed where necessary to ensure consistency with the policies adopted by the Group.
If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the
amounts previously recognised in other comprehensive income is reclassified to statements of income where appropriate.
Dilution gains and losses arising in investments in associates are recognised in the statements of income.
(vi) Loss of joint control or significant influence
When the Group ceases to equity account its joint venture or associate because of a loss of joint control or significant
influence, any retained interest in the entity is remeasured to its fair value with the change in carrying amount recognised
in profit or loss. This fair value becomes the initial carrying amount for the purposes of subsequently accounting for the
retained interest as a financial asset. In addition, any amount previously recognised in other comprehensive income in
respect of the entity is accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean
that amounts previously recognised in other comprehensive income are reclassified to statements of income.
(vii) Investments in subsidiaries, joint venture and associated companies
In the Company’s separate financial statements, investment in subsidiaries, joint venture and associated companies are
carried at cost less any accumulated impairment losses. On disposal of investments in subsidiaries, joint venture and
associated companies, the difference between disposal proceeds and the carrying amount of investments are recognised
in the statements of income.
If assets, including a subsidiary, joint venture or associate, are transferred by means of a dividend between entities under
common control, the transferee recognises the dividend at the fair value of the investments or assets received. Dividends
are to be recognised in statements of income.
Investment in debt instrument issued by subsidiary companies at amortised cost are measured in accordance with Note E.

C RECOGNITION OF INTEREST/PROFIT INCOME AND INTEREST/PROFIT EXPENSE
Interest and financing income and expense for all interest/profit bearing financial instruments are recognised within interest
income and interest expense and income from Islamic banking business in the statements of income using the effective
interest/profit method. Interest/profit income from financial assets at fair value through profit or loss is disclosed as separate
line item in statements of income.
The effective interest/profit method is a method of calculating the amortised cost of a financial asset or a financial liability and
of allocating the interest and financing income or interest/profit expense over the relevant period. The effective interest/profit
rate is the rate that discounts estimated future cash payments or receipts through the expected life of the financial instruments
or, when appropriate, a shorter period to the net carrying amount of the financial asset or financial liability. When calculating the
effective interest/profit rate, the Group and the Company take into account all contractual terms of the financial instrument and
includes any fees or incremental costs that are directly attributable to the instrument and are an integral part of the effective
interest/profit rate, but not future credit losses.
Interest/profit income is calculated by applying the effective interest/profit rate to the gross carrying amount of a financial asset
except for financial assets that subsequently become credit-impaired. For credit-impaired financial assets, the effective interest/
profit rate is applied to the net carrying amount of the financial asset (after deduction of the loss allowance).
D RECOGNITION OF FEES AND OTHER INCOME
(i) The Group earn fee and commission income from a diverse range of products and services provided to its customers. Fee
and commission income are recognised when the Group has satisfied its performance obligation in providing the promised
products and services to the customer, and are recognised based on contractual rates or amount agreed with customers,
and net of expenses directly related to it. The Group generally satisfy its performance obligation and recognises the fee
and commission income on the following basis:
• Transaction-based fee and commission income is recognised on the completion of the transaction. Such fees include
fees related to the completion of corporate advisory transactions, commissions, service charges and fees, credit card
related fees and fees on loans, advances and financing. These fees constitute a single performance obligation.
• For a service that is provided over a period of time, fee and commission income is recognised on an equal proportion
basis over the period during which the related service is provided or credit risk is undertaken. This basis of recognition
most appropriately reflects the nature and pattern of provision of these services to the customers over time. Fees for
these services will be billed periodically over time. Such fees include guarantee fees and commitment fees.
The Group do not provide any significant credit terms to customers for the above products and services.
Directly related expenses typically include card-related expenses and sales commissions, but do not include expenses for
services delivered over a period (such as service contracts) and other expenses that are not specifically related to fee and
commission income transactions.
(ii) Dividends are recognised when the right to receive payment is established. This applies even if they are paid out of pre-
acquisition profits. However, the investment may need to be tested for impairment as a consequence. Dividend income
received from subsidiary companies, joint venture, associated companies, financial assets at fair value through profit or
loss and financial investments at fair value through other comprehensive income are recognised as non-interest income
in statements of income. Dividends that clearly represent a recovery of part of the cost of investment is recognised in
other comprehensive income if it relates to an investment in equity instruments measured at fair value through other
comprehensive income.
146 • FINANCIALS

D RECOGNITION OF FEES AND OTHER INCOME (continued)
(iii) Net gain or loss from disposal of financial assets at fair value through profit or loss and debt instruments at fair value
through other comprehensive income are recognised in statements of income upon disposal of the securities, as the
difference between net disposal proceeds and the carrying amount of the securities.
(iv) Brokerage income is recognised when contracts are executed. Fees that constitute single performance obligation is
recognised upon completion of transactions such as rollover fees, nominees services and handling charges.
(v) Corporate advisory fees are recognised as income after fulfilling each of the performance obligation.
(vi) Rental income is recognised on an overtime basis.
(vii) Management expenses, commission expenses and wakalah fees.
Acquisition costs, commissions and management fees are borne by the family takaful fund in the revenue accounts of
Hong Leong MSIG Takaful Berhad (“HLMT”) at an agreed percentage of the gross contribution, in accordance with the
principles of wakalah as approved by HLMT’s Shariah Advisory Committee and agreed between the participants and HLMT.
These are transferred to the shareholders’ fund via upfront wakalah fee and deferred wakalah fee.
Management fees charged for management of clients’ and unit trust funds is recognised over the period of time in
accordance with the rates provided for in the prospectuses of unit trust funds and investment mandate with private
customers. Other management fees charged for underwriting, placement and advisory fees are recognised over the period
during which the related service is provided or credit risk is undertaken.
(viii) Premium/contribution - life insurance and family takaful fund
Premiums/contributions are recognised as soon as the amount of premiums/contributions can be reliably measured. First
premium/contribution is recognised from inception date and subsequent premiums/contributions are recognised on due
dates.
Inward treaty reinsurance premiums/retakaful contributions are recognised on the basis of periodic advices received from
ceding companies.
Outward reinsurance premiums/retakaful contributions are recognised in the same accounting period as the original
policies certificates to which the reinsurance/retakaful relates.
E FINANCIAL ASSETS
(i) Classification
The Group and the Company have applied MFRS 9 and classified its financial assets in the following measurement
categories in accordance with MFRS 9 requirements:
• those to be measured subsequently at fair value (either through other comprehensive income (“OCI”) or through
profit or loss), and
• those to be measured at amortised cost.


E FINANCIAL ASSETS (continued)
(i) Classification (continued)
The Group and the Company reclassify debt investments when and only when its business model for managing those
assets changes. The Group and the Company do not change the classification of the remaining financial assets held in the
business model, but consider the circumstances leading to the model change when assessing newly originated or newly
purchased financial assets going forward.
Business model assessment

The Group and the Company conduct assessment of the objective of a business model to align with how an asset held
within a portfolio is being managed. Factors that are being considered include the key objectives of a portfolio whether
the business strategy is to earn contractual interest revenue, matching the duration of the financial assets to the duration
of the liabilities that are funding those assets or realising a portfolio through sale of assets. Other factors considered also
include the frequency and volume of sales in prior periods, how the asset’s performance is evaluated and reported to key
management personnel.
Assessment whether contractual cash flows are solely payments of principal and interest (“SPPI”)
Where the business model is to hold the financial assets to collect contractual cash flows, or to collect contractual cash
flows and sell, the Group and the Company assess whether the financial assets’ contractual cash flows represent solely
payment of principal and interest. In applying the SPPI test, the Group and the Company consider whether the contractual
cash flows are consistent with a basic lending arrangement, i.e. interest includes only consideration for time value of
money, credit risk, other basic lending risks and a profit margin that is consistent with a basic lending arrangement. Where
the contractual terms introduce exposure to risk or volatility that are inconsistent with a basic lending arrangement, the
related financial asset is classified and measured at fair value through profit or loss. Financial assets with embedded
derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and
interest.
(ii) Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Group and
the Company commit to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash
flows from the financial assets have expired or have been transferred and the Group and the Company have transferred
substantially all the risks and rewards of ownership.
(iii) Measurement
At initial recognition, the Group and the Company measure a financial asset at its fair value plus, in the case of a financial
asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial
asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in statements of income.
Debt instruments
Subsequent measurement of debt instruments depends on the Group’s and the Company’s business model for managing
the financial asset and the cash flow characteristics of the financial asset. There are three measurement categories into
which the Group and the Company classify its debt instruments:
148 • FINANCIALS

(iii) Measurement (continued)
(a) Amortised cost
Financial assets that are held for collection of contractual cash flows where those cash flows represent SPPI, and that
are not designated at fair value through profit or loss, are measured at amortised cost using the effective interest
method. Interest/profit income from these financial assets is included in interest income and income from Islamic
banking business using the effective interest rate method. Any gain or loss arising on derecognition is recognised
directly in statements of income as presented in net realised gain or loss on financial instruments. Impairment losses
are presented as separate line item (as per Note 39 and Note 40) in the statements of income.
(b) Fair value through other comprehensive income
Financial assets that are held for collection of contractual cash flows and for selling the financial assets, where
the financial assets’ cash flows represent SPPI, and that are not designated at fair value through profit or loss, are
measured at fair value through other comprehensive income. Movements in the carrying amount are taken through
OCI, except for the recognition of impairment gains or losses, interest/profit income and foreign exchange gains and
losses which are recognised in statements of income. When the financial asset is derecognised, the cumulative gain
or loss previously recognised in OCI is reclassified from equity to statements of income and recognised in net realised
gain or loss on financial instruments. Interest/profit income from these financial assets is included in interest income
and income from Islamic banking business using the effective interest rate method. Foreign exchange gains and
losses are presented in other income (as per Note 37) and impairment losses are presented as separate line item in
(c) Fair value through profit or loss
Financial assets that do not meet the criteria for amortised cost or fair value through other comprehensive income
are measured at fair value through profit or loss. The Group and the Company may also irrevocably designate
financial assets at fair value through profit or loss if doing so significantly reduces or eliminates a mismatch created
by assets and liabilities being measured on different bases. Fair value changes is recognised in statements of income
and presented net within net unrealised gain or loss on revaluation in the period which it arises.
Equity instruments
The Group and the Company subsequently measure all equity investments at fair value through profit or loss, except where
the management has elected, at initial recognition to irrevocably designate an equity instrument at fair value through
other comprehensive income. Where the Group’s and the Company’s management have elected to present fair value
gains and losses on equity investments in OCI, there is no subsequent reclassification of fair value gains and losses to
statements of income following the derecognition of the investment. Cumulative gain or loss previously recognised in OCI
is not subsequently reclassified to statements of income, but is to be transferred to retained profits. Dividends from such
investments continue to be recognised in statements of income as other income when the Group’s and the Company’s
right to receive payments is established.
Changes in the fair value of equity instruments designated as financial assets at fair value through profit or loss are
recognised in net unrealised gain or loss on revaluation in the statements of income.

(iv) Reclassification policy
Reclassification of financial assets is required when, and only when, the Group and the Company change their business
model for managing the assets. In such cases, the Group and the Company are required to reclassify all affected financial
assets.
However, it will be inappropriate to reclassify financial assets that have been designated at fair value through profit or loss,
or equity instruments that have been designated as at fair value through other comprehensive income even when there
is a change in business model. Such designations are irrevocable.
F FINANCIAL LIABILITIES
Financial liabilities are measured at amortised cost, except for trading liabilities designated at fair value, which are held at fair
value through profit or loss. Financial liabilities are initially recognised at fair value plus transaction costs for all financial liabilities
not carried at fair value through profit or loss. Financial liabilities at fair value through profit or loss are initially recognised at fair
value, and transaction costs are expensed in statements of income. Financial liabilities are de-recognised when extinguished.
(i) Financial liabilities at fair value through profit or loss
This category comprises two sub-categories: financial liabilities as held-for-trading, and financial liabilities designated at
fair value through profit or loss upon initial recognition.
A financial liability is classified as held-for-trading if it is acquired or incurred principally for the purpose of selling or
repurchasing it in the near term or if it is part of a portfolio of identified financial instruments that are managed together
and for which there is evidence of a recent actual pattern of short term profit-taking. Derivatives are also categorised as
held-for-trading unless they are designated as hedges.
The Group has also designated certain structured deposits at fair value through profit or loss as permitted under MFRS 9
“Financial Instruments” as it significantly reduces accounting mismatch that would otherwise arise from measuring the
corresponding assets and liabilities of different basis.
(ii) Financial liabilities at amortised cost
Financial liabilities that are not classified as fair value through profit or loss fall into this catergory and are measured at
amortised cost. Financial liabilities are initially recognised at fair value plus transaction costs. Subsequently, financial
liabilities are remeasured at amortised cost using the effective interest/profit rate.
Financial liabilities measured at amortised cost are deposits from customers, investment accounts of customers, deposits
and placements of banks and other financial institutions, obligations on securities sold under repurchase agreements,
bills and acceptances payable, lease liabilities, other financial liabilities, recourse obligation on loans/financing sold to
Cagamas, Tier 2 subordinated bonds and Multi-currency additional Tier 1 capital securities.
150 • FINANCIALS

G PROPERTY AND EQUIPMENT AND DEPRECIATION
Property and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. Subsequent
costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable
that future economic benefits associated with the item will flow to the Group and the Company and the cost of the item can be
measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to
the statements of income during the financial period in which they are incurred.
Freehold land is not depreciated as it has an infinite life. Other property and equipment are depreciated on a straight-line
method to allocate the cost or the revalued amounts, to their residual values over their estimated useful lives, summarised as
follows:
Leasehold land Over the remaining period of the lease or 100 years (1%) whichever is shorter
Buildings on leasehold land Over the remaining period of the lease or 50 years (2%) whichever is shorter
Buildings on freehold land 2%
Office furniture, fittings, equipment and
renovations and computer equipment 10% - 33%
Motor vehicles 20% - 25%
The assets’ residual values and useful lives are reviewed and adjusted if appropriate, at the end of each reporting period.
Depreciation on assets under construction commences when the assets are ready for their intended use.
Property and equipment are reviewed for indication of impairment at each statements of financial position date and whenever
events or changes in circumstances indicate that the carrying amount may not be recoverable. Where an indication of impairment
exists, the carrying amount of the asset is greater than its estimated recoverable amount, it is written down immediately to its
recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount and are included in non-interest
income.
If an item of owner-occupied property becomes an investment property because its use has changed, any difference resulting
between the carrying amount and the fair value of such a property at the date of transfer is treated in the same way as a
revaluation under MFRS 116 “Property, plant and equipment”. Any resulting increase in the carrying amount of the property
is recognised in profit or loss to the extent that it reverses a previous impairment loss, with any remaining increase credited
directly to other comprehensive income in revaluation surplus reserve. Any resulting decrease in the carrying amount of the
property is initially charged in other comprehensive income against any previously recognised revaluation surplus reserve, with
any remaining decrease charged to statements of income.
Leased assets presented under property and equipment and prepaid lease payments are right-of-use assets within the scope of
MFRS 16. See Note I for the accounting policies on right-of-use assets.
H INTANGIBLE ASSETS
(i) Computer software
Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and bring to use the
specific software. These costs are amortised over their estimated useful lives of 3 years to 8 years.

H INTANGIBLE ASSETS (continued)
(ii) Goodwill
Goodwill arises on the acquisition of subsidiaries and represents the excess of the aggregate of fair value consideration
transferred, the amount of any non-controlling interest in the acquiree and the fair value of any previous equity interest in
the acquiree over the fair value of the net identifiable assets acquired and liabilities assumed on the acquisition date. If the
fair value of consideration transferred, the amount of non-controlling interest and the fair value of previously held interest
in the acquiree are less than the fair value of the net identifiable assets of the acquiree, the resulting gain is recognised in
Goodwill is not amortised but it is tested for impairment annually or more frequently if events or changes in circumstances
indicate that it might be impaired, and carried at cost less accumulated impairment losses. For the purpose of impairment
testing, goodwill acquired in a business combination is allocated to each of the cash generating units (“CGUs”), or groups of
CGUs, that is expected to benefit from the synergies of the combination. Each unit or group of units to which the goodwill
is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management
purposes. Goodwill is monitored at the CGU level. The carrying value of goodwill is compared to the recoverable amount,
which is the higher of value in use and the fair value less costs of disposal. Any impairment is recognised immediately as
an expense and is not subsequently reversed.
I LEASES
Leases are recognised as right-of-use (“ROU”) asset and a corresponding liability at the date on which the leased asset is
available for use by the Group and the Company (i.e. the commencement date).
Contracts may contain both lease and non-lease components. The Group and the Company allocate the consideration in the
contract to the lease and non-lease components based on their relative stand-alone prices.
Lease term
In determining the lease term, the Group and the Company considers all facts and circumstances that create an economic
incentive to exercise an extension option, or not to exercise a termination option. Extension options (or periods after termination
options) are only included in the lease term if the lease is reasonably certain to be extended (or not to be terminated).
The Group and the Company reassess the lease term upon the occurrence of a significant event or change in circumstances that
is within the control of the Group and the Company, and affects whether the Group and the Company is reasonably certain to
exercise an option not previously included in the determination of lease term, or not to exercise an option previously included in
the determination of lease term. A revision in lease term results in remeasurement of the lease liabilities. See accounting policy
below on reassessment of lease liabilities.
ROU assets
ROU assets are initially measured at cost comprising the following:
• the amount of the initial measurement of lease liability;

• any lease payments made at or before the commencement date less any lease incentive received;
• any initial direct costs; and
• decommissioning or restoration costs.
152 • FINANCIALS

I LEASES (continued)
ROU assets (continued)
ROU assets that are not investment properties are subsequently measured at cost, less accumulated depreciation and impairment
loss (if any). The ROU assets are generally depreciated over the shorter of the asset’s useful life and the lease term on a straight-
line basis. If the Group and the Company are reasonably certain to exercise a purchase option, the ROU asset is depreciated over
the underlying asset’s useful life. In addition, the ROU assets are adjusted for certain remeasurement of the lease liabilities.
Lease liabilities
Lease liabilities are initially measured at the present value of the lease payments that are not paid at that date. The lease
payments include the following:
• fixed payments (including in-substance fixed payments), less any lease incentive receivable;
• amounts expected to be payable by the Group and the Company under residual value guarantees;
• the exercise price of a purchase and extension options if the Group and the Company are reasonably certain to exercise
that option; and
• payments of penalties for terminating the lease, if the lease term reflects the Group and the Company exercising that
option.
Lease payments are discounted using the interest/profit rate implicit in the lease. If that rate cannot be readily determined,
which is generally the case for leases in the Group and the Company, an incremental borrowing rate is used in determining the
discount rate which assumes the interest/profit rate that the Group and the Company would have to pay to borrow over a similar
term, the funds necessary to obtain the asset.
Lease payments are allocated between principal and finance cost. The finance cost is charged to statements of income over the
lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
The Group and the Company present the lease liabilities as a separate line item in the statements of financial position. Interest
expense on the lease liability is presented within the other interest expenses in the statements of income.
Short term leases and leases of low value assets
The Group and the Company elect to apply MFRS 16 recognition exemption such as short-term leases and leases for which
the underlying asset is of low value. Short-term leases are leases with a lease term of 12 months or less with no purchase
option. Low-value assets comprise IT equipment and small items of office furniture. Payments associated with short-term
leases of equipment and vehicles and all leases of low-value assets are recognised on a straight-line basis as an expense in the
statements of income.
J IMPAIRMENT OF NON-FINANCIAL ASSETS
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are
subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the carrying amount of the assets
exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less cost of disposal and value-
in-use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which separately identifiable
cash flows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units).
Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each
reporting date.

J IMPAIRMENT OF NON-FINANCIAL ASSETS (continued)
The impairment loss is charged to the statements of income unless it reverses a previous revaluation in which case it is charged
to the revaluation surplus. Any subsequent increase in recoverable amount of non-financial assets (other than goodwill) is
recognised in the statements of income unless it reverses an impairment loss on a revalued asset in which case it is taken to
revaluation surplus.
K CURRENT AND DEFERRED INCOME TAXES
The tax expense for the period comprises current and deferred income tax. The income tax expense or credit for the period is
the tax payable on the current period’s taxable income based on the applicable income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. Tax is recognised
in statements of income, except to the extent that it relates to items recognised in other comprehensive income or directly in
equity, respectively. In this case, the tax is recognised in other comprehensive income or directly in equity, respectively. The
liabilities in relation to tax penalties or its associated interest are included within the taxation liability on the statement of
financial position and any associated change within the tax expense in the statements of income as under accrual of prior year
tax.
Current income tax expense is determined according to the tax laws enacted or substantively enacted at the end of the reporting
period of each jurisdiction in which the Group operates and generates taxable income and includes all taxes based upon the
taxable profits.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation
is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax
authorities. This liability is measured using the single best estimate of the most likely outcome.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not recognised
if they arise from the initial recognition of goodwill. Deferred tax is not accounted for if it arises from initial recognition of an
asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting
nor taxable profit or loss.
Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the
temporary differences of unused tax losses or unused tax credits can be utilised.
Deferred tax liability is recognised on temporary differences arising on investments in subsidiaries, associates and joint venture
except where the timing of the reversal of the temporary difference can be controlled by the Group and it is probable that the
temporary difference will not reverse in the foreseeable future. Generally the Group is unable to control the reversal of the
temporary difference for associates and joint venture. Only where there is an agreement in place that gives the Group the ability
to control the reversal of the temporary difference, a deferred tax liabilities is not recognised.
Deferred income tax assets are recognised on deductible temporary differences arising from investments in subsidiaries,
associates and joint arrangements only to the extent that it is probable the temporary difference will reverse in the future and
there is sufficient taxable profit available against which the deductible temporary difference can be utilised.
Deferred income tax related to fair value remeasurement of financial instruments at fair value through other comprehensive
income, which are charged or credited directly to equity, is also credited or charged directly to equity and is subsequently
recognised in the statements of income together with the deferred gain or loss.
154 • FINANCIALS

K CURRENT AND DEFERRED INCOME TAXES (continued)
Deferred income tax is determined using tax rates (and tax laws) that have been enacted or substantively enacted by the end
of the reporting period and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is
settled.
Deferred and income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
against current tax liabilities and when the deferred income tax assets and liabilities relate to taxes levied by the same taxation
authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net
basis.
L DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGE ACCOUNTING
The Group has elected an accounting policy choice under MFRS 9 to continue to apply the hedge accounting requirements under
MFRS 139 on the adoption of MFRS 9 on 1 July 2018.
The Group and the Company derivatives are initially recognised at fair value on the date on which a derivative contract is entered
into and are subsequently remeasured at their fair value at the end of each reporting period. Fair values are obtained from
quoted market prices in active markets, including recent market transactions, and valuation techniques, including discounted
cash flow models and option pricing models, as appropriate. All derivatives are carried as assets when fair value is positive and
as liabilities when fair value is negative. Changes in the fair value of any derivatives that do not qualify for hedge accounting
are recognised immediately in the statements of income. Cash collateral held in relation to derivative transactions are carried at
amortised cost.
The best evidence of fair value of a derivative at initial recognition is the transaction price (i.e. the fair value of the consideration
given or received) unless the fair value of the instrument is evidenced by comparison with other observable current market
transactions in the same instrument (i.e. without modification or repackaging) or based on a valuation technique whose variables
include only data from observable markets. When such evidence exists, the Group recognise profits immediately.
The method of recognising the resulting fair value gain or loss depends on whether the derivative is designated as a hedging
instrument, and if so, the nature of the item being hedged. The Group designated certain derivatives as either: (1) hedges of
the fair value of recognised assets or liabilities or firm commitments (fair value hedge) or (2) hedges of highly probable future
cash flows attributable to a recognised asset or liability, or a forecasted transaction (cash flow hedge) or (3) hedges of a net
investment in a foreign operation (net investment hedge). Hedge accounting is used for derivatives designated in this way
provided certain criteria are met.
The Group has applied the following Phase 1 reliefs provided by the Amendments to MFRS 9 and MFRS 7 “Interest Rate Benchmark
Reform” until the uncertainty arising from IBOR reform no longer being present:
• When considering the “highly probable” requirement, the Group has assumed that the IBOR interest rate on which the
Group’s hedged borrowings is based does not change as a result of IBOR reform.
• In assessing whether the hedge is expected to be highly effective on a forward-looking basis, the Group has assumed that
the IBOR interest rate on which the cash flows of the hedged borrowings and the interest rate swap that hedges it are
based is not altered by IBOR reform.
• The Group has not recycled the cash flow hedge reserve for designated hedges that are subject to the IBOR reform.

L DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGE ACCOUNTING (continued)
The Group has applied the following reliefs provided by the Amendments to MFRS 9 and MFRS 7 “Interest Rate Benchmark
Reform - Phase 2”:
• Hedge designation: When the Phase 1 amendments cease to apply, the Group will amend its hedge designation to reflect
changes which are required by IBOR reform, but only to make one or more of the following changes:
(i) designating an alternative benchmark rate (contractually or non-contractually specified) as a hedged risk;
(ii) amending the description of the hedged item, including the description of the designated portion of the cash flows
or fair value being hedged; or
(iii) amending the description of the hedging instrument.
The Group amends its hedge documentation to reflect this change in designation by the end of the reporting period in which
the changes are made. These amendments to the hedge documentation do not require the Group to discontinue its hedge
relationships.
The fair values of various derivative instruments used for hedging purposes are disclosed in Note 10 to the financial statements.
Movements on the hedging reserve in shareholders’ equity are shown in Note 30.
(i) Fair value hedges
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the statements
of income, together with any changes in the fair value of the hedged assets or liabilities that are attributable to the hedged
risk.
The Group and the Company apply fair value hedge accounting for hedging fixed interest risk on loans, advances and
financing and financial assets at FVOCI. The gain or loss relating to the effective portion of interest rate swaps hedging
fixed rate loans, advances and financing is recognised in income statements within other operating income. The gain or
loss relating to the ineffective portion is recognised in income statements within net gain or loss on fair value hedges.
For fair value hedge of financial assets designated as FVOCI, any changes in fair value of the hedged financial assets FVOCI
are recycled from FVOCI reserves to income statements, while the changes in fair value of the derivatives that is related
to the effective portion of the hedge is recognised in income statements within other operating income. The ineffective
portion of the aforesaid hedging derivatives is recognised in income statements with net gain or loss on fair value changes
of derivatives.
If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item
for which the effective interest method is used is amortised to statements of income over the period to maturity using a
recalculated effective interest rate.
(ii) Cash flow hedges
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are
recognised in equity. The gain and loss relating to the ineffective portion is recognised immediately in the statements of
income. Amounts accumulated in equity are recycled to the statements of income in the financial periods in which the
hedged item will affect statements of income.
156 • FINANCIALS

L DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGE ACCOUNTING (continued)
(ii) Cash flow hedges (continued)
When a hedging instrument expires or is sold or transferred, or when a hedge no longer meets the criteria for hedge
accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast
transaction is ultimately recognised in the statements of income. When a forecast transaction is no longer expected to
occur, the cumulative gain or loss that was reported in equity is immediately reclassified to the statements of income.
(iii) Derivatives that do not qualify for hedge accounting
Certain derivative instruments do not qualify for hedge accounting. Changes in the fair value of any derivative instrument
that does not qualify for hedge accounting are recognised immediately in the statements of income.
M CURRENCY TRANSLATIONS
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary
economic environment in which the entity operates (“the functional currency”). The consolidated financial statements are
presented in Ringgit Malaysia, which is the Company’s functional and presentation currency.
(ii) Foreign currency transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates
of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognised in the statements of income, except when deferred in equity
as qualifying cash flow hedges and qualifying net investment hedges or are attributable to items that form part of the net
investment in a foreign operation.
Changes in the fair value of monetary securities denominated in foreign currency classified as financial investments at fair
value through other comprehensive income are analysed between translation differences resulting from changes in the
amortised cost of the security and other changes in the carrying amount of the security. Translation differences related to
changes in the amortised cost are recognised in the statements of income, and other changes in the carrying amount are
recognised in other comprehensive income.
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the
date when the fair value is determined. Translation differences such as equity held at fair value through profit or loss
and assets and liabilities carried at fair value are reported as part of the fair value gain or loss. Translation differences
on non-monetary financial assets such as equities held at fair value through profit or loss are recognised in income as
part of the fair value gain or loss. Translation differences on non-monetary financial assets such as equities classified as
financial investments at fair value through other comprehensive income are included in the fair value reserve in other

M CURRENCY TRANSLATIONS (continued)
(iii) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy)
that have a functional currency different from the presentation currency are translated into the presentation currency as
follows:
• assets and liabilities for each statements of financial position presented are translated at the closing rate at the date
of the statements of financial position;
• income and expenses for each statements of income are translated at average exchange rates (unless this average
is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which
case income and expenses are translated at the rate on the dates of the transactions); and
• all resulting exchange differences are recognised as a separate component of statements of comprehensive income.
On consolidation, exchange differences arising from the translation of the net investment in foreign operations, and of
borrowings and other currency instruments designated as hedges of such investments, are recognised in statements of
On the disposal of a foreign operation (that is, a disposal of the Group’s entire interest in a foreign operation, or a disposal
involving loss of control over a subsidiary that includes a foreign operation, a disposal involving loss of joint control over
a jointly controlled entity that includes a foreign operation, or a disposal involving loss of significant influence over an
associate that includes a foreign operation), all of the exchange differences relating to that foreign operation recognised
in other comprehensive income and accumulated in the separate component of equity are reclassified to statements of
income. In the case of a partial disposal that does not result in the Group losing control over a subsidiary that includes
a foreign operation, the proportionate share of accumulated exchange differences are re-attributed to non-controlling
interests and are not recognised in statements of income. For all other partial disposals (that is, reductions in the Group’s
ownership interest in associates or jointly controlled entities that do not result in the Group losing significant influence or
joint control) the proportionate share of the accumulated exchange difference is reclassified to statements of income.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of
the foreign entity and translated at the closing rate. Exchange differences arising are recognised in other comprehensive
income.
N EMPLOYEE BENEFITS
(i) Short-term employee benefits
Wages, salaries, paid annual leave and sick leave, bonuses, and non-monetary benefits that are expected to be settled
wholly within 12 months after the end of the period in which the employees render the related services are recognised
in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be
paid when the liabilities are settled.
The Group and the Company recognise a liability and an expense for bonuses. The Group and the Company recognise a
provision where contractually obliged or where there is a past practice that has created constructive obligation.
158 • FINANCIALS

N EMPLOYEE BENEFITS (continued)
(ii) Defined contribution plans
A defined contribution plan is a pension plan under which the Group and the Company pay fixed contributions into a
separate entity (fund) on a mandatory, contractual or voluntary basis and the Group and the Company have no legal
or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees
benefits relating to employee service in the current and prior financial periods.
The Group and the Company contributes to a national defined contribution plan (the Employee Provident Fund) on a
mandatory basis and the amounts contributed to the plan are charged to the statements of income in the period to which
they relate. Once the contributions have been paid, the Group and the Company has no further payment obligations.
Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is
available.
(iii) Share-based compensation
The Company and certain of its subsidiaries operate equity-settled, share-based compensation plans for their employees.
The fair value of the employee services received in exchange for the grant of the share options is recognised as an expense
in the statements of income over the vesting periods of the grant with a corresponding increase to share options reserve
within equity.
The total amount to be expensed over the vesting period is determined by reference to the fair value of the share
options granted, excluding the impact of any non-market vesting conditions. Non-market vesting conditions are included
in assumptions about the number of options that are expected to vest. At each statements of financial position date,
the Company revises its estimates of the number of share options that are expected to vest. It recognises the impact of
the revision of original estimates, if any, in the statements of income, with a corresponding adjustment to share options
reserve in equity.
A trust has been set up for the Executive Share Scheme (“ESS”) and is administered by an appointed trustee. The trustee
will be entitled from time to time to accept financial assistance from the Company upon such terms and conditions as the
Company and the trustee may agree to purchase the Company’s stocks from the open market for the purposes of this trust.
In accordance with MFRS 132 “Financial Instruments: Presentation”, the shares purchased for the benefit of the ESS holders
are recorded as “Treasury Shares for ESS” in equity on the statements of financial position. The cost of operating the ESS
would be charged to the statements of income when incurred in accordance with accounting standards.
When the options are exercised, the Group transfers the Treasury Shares for ESS to the ESS holder. The treasury shares and
share options reserve would be adjusted against the retained profits.
When the options are exercised, the Company and certain of its subsidiaries issue new shares. The proceeds received net
of any directly attributable transaction costs are credited to share capital.
When options are not exercised and lapsed, the share options reserve is transferred to retained profits.

O IMPAIRMENT OF FINANCIAL ASSETS
The Group and the Company assess on a forward looking basis the expected credit loss (“ECL”) associated with its financial assets
carried at amortised cost and fair value through other comprehensive income. The impairment methodology applied depends on
whether there has been a significant increase in credit risk.
The Group and the Company assess whether the credit risk on an exposure has increased significantly on an individual or
collective basis. The Group and the Company first assess whether objective evidence of impairment exists for financial assets
which are individually significant. If the Group and the Company determine the objective evidence of impairment exists, i.e.
credit-impaired for an individually assessed financial asset, a lifetime ECL will be recognised for impairment loss. Financial assets
which are collectively assessed are grouped on the basis of similar credit risk characteristics.
Definition of default and credit-impaired financial assets
The definition of credit-impaired of the Group and the Company remained the same under MFRS 139 and MFRS 9. At each
reporting period, the Group and the Company assess whether financial assets are impaired. Qualitative and quantitative
information are used to determine if a financial asset is credit impaired. Nevertheless, a backstop is applied and a financial asset
is considered as credit impaired if it is more than 90 days or 3 months past due on its contractual payments.
As part of the assessment of impairment of financial assets under ECL model, the default definition, which is largely align with
regulatory reporting purposes, has been applied to three main components, which is a probability of default (“PD”) model, a loss
given default (“LGD”) model and exposure at default (“EAD”) model respectively.
Where measurement of ECL is relying on external published sources, in determining if a financial asset is credit-impaired, the
Group and the Company will consider factors, such as, but not limited to, rating agencies’ assessment of creditworthiness and
country’s ability to access to capital markets for new debt issuance.
There are two approaches of ECL adopted by the Group and the Company, which are general approach and simplified approach.
(i) Financial assets accounted for at amortised cost, fair value through other comprehensive income and with the
exposure arising from loan commitments and financial guarantee contracts - General Approach
ECL will be assessed using an approach which classified financial assets into three stages which reflects the change in
credit quality of the financial assets since initial recognition:
(a) Stage 1: 12-months ECL - not credit impaired
Stage 1 includes financial assets which have not had a significant increase in credit risk since initial recognition or
which have low credit risk at reporting date. 12-months ECL is recognised and interest income is calculated on the
gross carrying amount of the financial assets.
(b) Stage 2: Lifetime ECL - not credit impaired
Stage 2 includes financial assets which have had a significant increase in credit risk since initial recognition (unless
they have low credit risk at the reporting date) but do not have objective evidence of impairment. Lifetime ECL is
recognised and interest income is calculated on the gross carrying amount of the financial assets.
(c) Stage 3: Lifetime ECL - credit impaired
Stage 3 includes financial assets that have objective evidence of impairment at the reporting date. Lifetime ECL is
recognised and interest income is calculated on the net carrying amount of the financial assets.
160 • FINANCIALS

O IMPAIRMENT OF FINANCIAL ASSETS (continued)
exposure arising from loan commitments and financial guarantee contracts - General Approach (continued)
Significant increase in credit risk
At each reporting date, the Group and the Company assess whether there has been a significant increase in credit risk for
exposures since initial recognition to determine whether the exposure is subject to 12-month ECL or lifetime ECL. This is
performed by comparing the risk of default occurring over the remaining expected life from the reporting date and the date
of initial recognition. When determining whether the risk of default has increased significantly since initial recognition, the
Group and the Company consider both quantitative and qualitative information and assessments based on the Group’s and
the Company’s historical experience and credit risk assessments, including forward-looking information. A backstop of 30
days or 1 month past due from its contractual payment is applied and a financial asset will still be designated as having
significant increase in credit risk regardless if it meets both the quantitative and qualitative assessments.
Measurement of ECL
ECL are measured using three main components, which include PD, LGD and EAD. These components are derived from
internally developed statistical models and adjusted to reflect forward-looking information as set out below.
The 12-month and lifetime PD represent the expected point-in-time probability of default over the next 12 months
and remaining lifetime of a financial instrument, based on conditions that exist at the reporting date and taking into
consideration of future economic conditions that affect credit risk. The LGD component represents that expected loss if
a default event occurs at a given time, taking into account the mitigating effect of collateral, its expected value when
realised and time value of money. The EAD represents the expected exposure at default, taking into account the repayment
of principal and interest from the reporting date to the default event together with expected drawdown and utilisation
of a facility. The 12-month ECL is equal to the discounted sum over the next 12 months of monthly PD multiplied by LGD
and EAD. The discount rate used in the ECL measurement is the original effective interest/profit rate or an approximation
thereof.
The measurement of ECL reflects an unbiased and probability-weighted amount that is derived by evaluating a range of
possible macroeconomic outcome, the time value of money together with reasonable and supportable information that
is available without undue cost or effort at the reporting date about past events, current conditions and forecast of future
economic conditions.
Forward looking information
The Group and the Company have internally developed methodologies for the application of forward looking
macroeconomic (“MEV”) which consist of economic indicators and industry statistics in the measurement of ECL. This
involves the incorporation of MEV forward looking into PD estimation, which is determined based on probability-weighted
outcome from a range of economic scenarios.
The measurement of ECL incorporates a broad range of forward-looking information as economic inputs, such as but not
limited to:
• Gross Domestic Product (“GDP”)

• Unemployment Rate
• Consumer Price Index
• House Price Index

exposure arising from loan commitments and financial guarantee contracts - General Approach (continued)
Forward looking information (continued)
The Group and the Company apply three economic scenarios to reflect an unbiased probability-weighted range of possible
future outcome in estimating ECL:
(a) Base case: This represents “most likely outcome” of future economic conditions which are backed by consensus
forecast from various sources.
(b) Best and Worst case: This represent the “upside” and “downside” outcome of future economic conditions by making
references to past historical cyclical conditions together with incorporation of best estimates and judgements on an
unbiased basis.
Modification of loans/financing
The Group may renegotiate or otherwise modify the contractual cash flows of loans/financing to customers. When this
happens, the Group assess whether or not the new terms are substantially different to the original terms.
The Group do this by considering, among others, the following factors:
• If the borrower is in financial difficulty, whether the modification merely reduces the contractual cash flows to
amounts the borrower is expected to be able to pay.
• Whether any substantial new terms are introduced, such as a profit share/equity-based return that substantially
affects the risk profile of the loan.
• Significant extension of the loan term when the borrower is not in financial difficulty.
• Significant change in the interest/profit rate.
• Change in the currency the loan/financing is denominated in.
• Insertion of collateral, other security or credit enhancements that significantly affect the credit risk associated with
the loan/financing.
If the terms are substantially different, the Group derecognise the original financial asset and recognises a “new” asset
at fair value and recalculates a new effective interest/profit rate for the asset. The date of renegotiation is consequently
considered to be the date of initial recognition for impairment calculation purposes, including for the purpose of determining
whether a significant increase in credit risk has occurred. However, the Group also assess whether the new financial asset
recognised is deemed to be credit-impaired at initial recognition, especially in circumstances where the renegotiation was
driven by the debtor being unable to make the originally agreed payments. Differences in the carrying amount are also
recognised in statements of income as a gain or loss on derecognition.
If the terms are not substantially different, the renegotiation or modification does not result in derecognition, and the
Group recalculate the gross carrying amount based on the revised cash flows of the financial asset and recognises a
modification gain or loss in statements of income. The new gross carrying amount is recalculated by discounting the
modified cash flows at the original effective interest/profit rate (or credit–adjusted effective interest/profit rate for
purchased or originated credit- impaired financial assets).
The impact of modifications of financial assets on the expected credit loss calculation is disclosed in Note 36.
162 • FINANCIALS

(ii) Clients’ and brokers’ balances and other assets - Simplified Approach
The Group and the Company apply simplified approach as permitted by MFRS 9, which requires an entity to recognise a loss
allowance based on lifetime ECL at each reporting date. MFRS 9 allows the use of practical expedients when measuring ECL
and states that a provision matrix is an example of such expedient for other receivables. An entity that applies a provision
matrix may use historical loss experience on its other receivables, and adjust historical loss rates to reflect information
about current conditions and reasonable and supportable forecasts of future economic conditions.
P DERECOGNITION OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES OTHER THAN ON A MODIFICATION
Financial assets are derecognised when the contractual rights to receive the cash flows from these assets have ceased to exist
or the assets have been transferred and substantially all the risks and rewards of ownership of the assets are also transferred.
Financial liabilities are derecognised when they have been redeemed or otherwise extinguished.
Collateral furnished by the Group under standard repurchase agreements transactions is not derecognised because the Group
retains substantially all the risks and rewards on the basis of the predetermined repurchase price, and the criteria for de-
recognition are therefore not met.
Q OFFSETTING FINANCIAL INSTRUMENTS
Financial assets and liabilities are offset and the net amount is presented in the statements of financial position where there
is a legally enforceable right to offset the recognised amounts and there is intention to settle on a net basis, or realise the
asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be
enforceable in the normal course of business and in the event of default, insolvency or bankruptcy.
R FINANCIAL GUARANTEE CONTRACTS
Financial guarantee contracts are contracts that require the Group or the Company to make specified payments to reimburse the
holder for a loss it incurs because a specified debtor fails to make payments when due, in accordance with the terms of a debt
instrument.
Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued and the liability is initially
measured at fair value.
The fair value of financial guarantees is determined based on the present value of the difference in cash flows between the
contractual payments required under the debt instrument and the payments that would be required without the guarantee, or
the estimated amount that would be payable to a third party for assuming the obligations.
Financial guarantee contracts are subsequently measured at the higher of the amount determined in accordance with the ECL
model under MFRS 9 “Financial Instruments” and the amount initially recognised less cumulative amount of income recognised
in accordance with the principles of MFRS 15 “Revenue from Contracts with Customers”, where appropriate.
S FORECLOSED PROPERTIES
Foreclosed properties are stated at the lower of carrying amount and fair value less cost to sell.

T BILLS AND ACCEPTANCES PAYABLE
Bills and acceptances payable represent the banking subsidiaries’ own bills and acceptances rediscounted and outstanding in the
market.
U PROVISIONS
Provisions are recognised by the Group and the Company when all of the following conditions have been met:
(i) the Group and the Company have a present legal or constructive obligation as a result of past events;
(ii) it is probable that an outflow of resources to settle the obligation will be required; and
(iii) a reliable estimate of the amount of obligation can be made.
Where the Group and the Company expect a provision to be reimbursed by another party, the reimbursement is recognised as a
separate asset but only when the reimbursement is virtually certain. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by
considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any
one item included in the same class of obligations may be small.
Provisions are measured at the present value of management’s best estimate of the expenditures expected to be required to
settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and risks specific
to the obligation. The increase in the provision due to passage of time is recognised as interest expense.
V CASH AND CASH EQUIVALENTS
Cash and short-term funds in the statements of financial position comprise cash balances and deposits with financial institutions
and money at call with a maturity of one month or less, which are subject to an insignificant risk of changes in value.
For the purpose of the statements of cash flows, cash and cash equivalents comprise cash and short-term funds and deposits
and placements with financial institutions, with original maturity of 3 months or less.
W SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker is the person or group that allocates resources and assesses the performance of the
operating segments of an entity. The Group has determined the Board of Directors as the collective body of chief operating
decision makers.
Segment revenue, expense, assets and liabilities are those amount resulting from the operating activities of a segment that
are directly attributable to the segment and the relevant portion that can be allocated on a reasonable basis to the segment.
Segment revenue, expense, assets and liabilities are determined before intra-group balances and intra-group transactions
are eliminated as part of the consolidation process, except to the extent that such intra-group balances and transactions are
between group enterprises within a single segment.
164 • FINANCIALS

X SHARE CAPITAL
(i) Classification
Ordinary shares are classified as equity. Other shares are classified as equity and/or liability according to the substance of
the particular instrument.
(ii) Share issue costs
Incremental external costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds.
(iii) Dividends
Distributions to shareholders are recognised directly in equity. Liability is recognised for the amount of any dividend
declared, being appropriately authorised and no longer at the discretion of the Group, on or before the end of the reporting
period but not distributed at the end of the reporting period.
(iv) Purchase of own shares
Where the Company purchases the Company’s equity share capital (treasury shares), the consideration paid, including any
directly attributable incremental costs, net of tax, is deducted from equity attributable to the Company’s equity holders
as treasury shares until they are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued,
any consideration received, net of any directly attributable incremental transaction costs and the related tax effects, is
adjusted against treasury shares.
Y CONTINGENT ASSETS AND CONTINGENT LIABILITIES
The Group does not recognise contingent assets and liabilities other than those arising from business combinations, but discloses
its existence in the financial statements. A contingent liability is a possible obligation that arises from past events whose
existence will be confirmed by the occurrence or non- occurrence of one or more uncertain future events beyond the control of
the Group or a present obligation that is not recognised because it is not probable that an outflow of resources will be required
to settle the obligation. A contingent liability also arises in the extremely rare case where there is a liability that cannot be
recognised because it cannot be measured reliably. However, contingent liabilities do not include financial guarantee contracts.
A contingent asset is a possible asset that arises from past events whose existence will be confirmed by the occurrence or non-
occurrence of one or more uncertain future events beyond the control of the Group. The Group does not recognise contingent
assets but discloses its existence where inflows of economic benefits are probable, but not virtually certain.
Z SALE AND REPURCHASE AGREEMENTS
Securities purchased under resale agreements (“reverse repurchase agreements”) are securities which the Group had purchased
with a commitment to re-sell at future dates. The commitment to re-sell the securities is reflected as an asset on the statements
of financial position.
Conversely, obligations on securities sold under repurchase agreements (“repurchase agreements”) are securities which the
Group had sold from its portfolio, with a commitment to repurchase at future dates. Such financing transactions and the
obligation to repurchase the securities are reflected as a liability on the statements of financial position.

Z SALE AND REPURCHASE AGREEMENTS (continued)
The difference between sale and repurchase price as well as purchase and resale price is treated as interest and accrued over
the life of the resale/repurchase agreement using the effective yield method.
AA EARNINGS PER SHARE
Basic earnings per share
Basic earnings per share is calculated by dividing:
• the profit attributable to owners of the Company, excluding any costs of servicing equity other than ordinary shares.
• by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in
ordinary shares issued during the year and excluding treasury shares.
Diluted earnings per share
Diluted earnings per share adjusts the figures in the determination of basic earnings per share to take into account:
• the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares, and
• the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion
of all dilutive potential ordinary shares.
AB INVESTMENT PROPERTIES
Investment properties, comprising principally land and office buildings, are held for long term rental yields or for capital
appreciation or both, and are not occupied by the Group.
Investment property is measured initially at its cost, including related transaction costs. After initial recognition, investment
property is carried at fair value. Fair value is based on active market prices, adjusted, if necessary, for any difference in the nature,
location or condition of the specific asset. If this information is not available, the Group uses alternative valuation methods, such
as recent prices on less active markets or discounted cash flow projections. The fair values of investment properties are reviewed
annually, and a formal valuation by an independent professional valuer is carried out once in every three years.
The fair value of investment property reflects, among other things, rental income from current leases and other assumptions that
market participants would make when pricing the property under current market conditions.
Subsequent expenditure is recognised to the asset’s carrying amount only when it is probable that future economic benefits
associated with the expenditure will flow to the Group and the cost of the item can be measured reliably. All other repairs and
maintenance costs are expensed when incurred. When part of an investment property is replaced, the carrying amount of the
replaced part is derecognised.
Changes in fair values are recognised in profit or loss. Investment properties are derecognised either when they have been
disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected
from its disposal.
Where the Group disposes of a property at fair value in an arm’s length transaction, the carrying value immediately prior to
the sale is adjusted to the transaction price, and the adjustment is recorded in profit or loss as a net gain/loss from fair value
adjustment on investment property.
166 • FINANCIALS

AC BENEFITS, CLAIMS AND EXPENSES
Benefits and claims that are incurred during the financial year are recognised when a claimable event occurs and/or the insurer/
takaful operator is notified.
Recoveries on reinsurance/retakaful claims are accounted for in the same financial year as the original claims are recognised.
Benefits and claims for claims arising on life insurance policies/family takaful certificates including settlement costs, less
reinsurance recoveries, are accounted for using the case basis method and for this purpose, the benefits payable under a life
insurance policy/family takaful certificate are recognised as follows:
(a) maturity or other policy/certificate benefit payments due on specified dates are treated as claims payable on the due
dates; and
(b) death, surrender and other benefits without due dates are treated as claims payable, on the date of receipt of intimation
of death of the assured/participant or occurrence of contingency covered.
AD INSURANCE CONTRACT LIABILITIES
These liabilities comprise of claims liabilities, actuarial liabilities, unallocated surpluses and net asset value attributable to
unitholders.
(i) Actuarial liabilities
Actuarial liabilities are recognised when contracts are entered into and premiums are charged.
These liabilities are measured by a prospective actuarial valuation method. The liability is determined as the sum of the
present value of future guaranteed and, in the case of a participating life policy, appropriate level of non-guaranteed
benefits, and the expected future management and distribution expenses, less the present value of future gross
considerations arising from the policy discounted at the appropriate risk discount rate. The liability is based on best
estimate assumptions and with due regard to significant recent experience. An appropriate allowance for provision of
risk margin for adverse deviation from expected experience is made in the valuation of non-participating life policies,
non-participating annuity policies, the guaranteed benefits liabilities of participating life policies and participating annuity
policies, and non-unit liabilities of investment-linked policies.
The liability in respect of policies of a participating insurance contract is taken as the higher of the guaranteed benefit
liabilities or the total benefit liabilities at the fund level.
In the case of a life policy where a part of, or the whole of the premiums are accumulated in a fund, the accumulated
amount, as declared to the policy owners, are set as the liabilities if the accumulated amount is higher than the figure as
calculated using the prospective actuarial valuation method.
Where policies or extensions of a policy are collectively treated as an asset at the fund level under the valuation method
adopted, the value of such asset is eliminated through zerorisation.
The liability is derecognised when the contract expires, is discharged or is cancelled.


AD INSURANCE CONTRACT LIABILITIES (continued)
(ii) Unallocated surplus
Surplus of contracts with discretionary participation features (“DPF”) is distributable to policyholders and shareholders
in accordance with the relevant terms under the insurance contracts. The insurance subsidiary, however, has discretion
over the amount and timing of the distribution of these surpluses to policyholders and shareholders. Surplus of contracts
without DPF is attributable wholly to the shareholders and is classified as equity of the Group and the insurance subsidiary.
However, the amount and timing of the distribution of surplus of contracts without DPF to the shareholders is subject to
the recommendation of the insurance subsidiary’s appointed actuary. Unallocated surpluses of DPF, where the amounts of
surplus are yet to be allocated or distributed to either policyholders or shareholders by the end of the financial year, are
held within the insurance contract liabilities.
AE INSURANCE PRODUCT CLASSIFICATION
An insurance contract is a contract under which the insurance subsidiary (the insurer) has accepted significant insurance risk
from another party (the policyholders) by agreeing to compensate the policyholders if a specified uncertain future event (the
insured event) adversely affects the policyholders. The insurance subsidiary defines insurance risk to be significant when the
benefits payable on the occurrence of the insured event are 5% or more than the benefits payable if the insured event did not
occur at any one point of the insurance contract. Based on this definition, all policy contracts issued by the insurance subsidiary
are considered insurance contracts as at the date of this statement of financial position.
Investment contracts are those contracts that do not transfer significant insurance risk, but significant financial risk. Financial risk
is the risk of a possible future change in one or more of a specified interest rate, financial instrument price, commodity price,
foreign exchange rate, index of price or rate, credit rating or credit index or other variable, provided in the case of a non-financial
variable that the variable is not specific to a party to the contract. Insurance risk is the risk other than financial risk.
Once a contract has been classified as an insurance contract, it remains an insurance contract for the remainder of its life-time,
even if the insurance risk reduces significantly during this period, unless all rights and obligations are extinguished or expire.
Investment contracts can, however, be reclassified as insurance contracts after inception if insurance risk becomes significant.
Insurance and investment contracts are further classified as being either with or without DPF. DPF is a contractual right to receive,
as a supplement to guaranteed benefits, additional benefits that are:
• likely to be a significant portion of the total contractual benefits;

• whose amount or timing is contractually at the discretion of the issuer; and
• that are contractually based on the:
- performance of a specified pool of contracts or a specified type of contract;
- realised and/or unrealised investment returns on a specified pool of assets held by the issuer; or
- profit or loss of the company, fund or other entity that issues the contract.
Contracts in the participating fund are classified as insurance contracts with DPF and contracts in the non-participating fund are
classified as insurance contracts without DPF.
For financial options and guarantees which are not closely related to the host insurance contract and/or investment contract
with DPF, bifurcation is required to measure these embedded derivatives separately at fair value through profit or loss. However,
bifurcation is not required if the embedded derivative is itself an insurance contract and/or investment contract with DPF, or if
the host insurance contract and/or investment contract itself is measured at fair value through profit or loss.
168 • FINANCIALS

AF VALUATION OF INSURANCE CONTRACT LIABILITIES
The valuation of the insurance liability arising from policy benefits made under life insurance contracts is the insurance
subsidiary’s most critical accounting estimate. The assumptions in relation to mortality, morbidity, longevity, investment returns,
expenses, lapse and surrender rates and discount rates are used for calculating the liabilities during the life of the contract. Such
assumptions require a significant amount of professional judgement and therefore, actual experience may be materially different
than the assumptions made by the insurance subsidiary. Actual experience is monitored to assess whether the assumptions
remain appropriate and assumptions are changed as warranted. Any movement in the key assumptions will have an effect in
determining the insurance contract liabilities.
AG FAMILY TAKAFUL FUND
The family takaful fund is maintained in accordance with the requirements of the Takaful Act, 1984 and includes the amount
attributable to participants. The amount attributable to participants represents the accumulated surplus attributable in accordance
with the terms and conditions prescribed by the Shariah Advisory Committee of Hong Leong MSIG Takaful Berhad (“HLMT”).
The family takaful fund surplus/deficit is determined by an annual actuarial valuation of the family takaful fund. Any actuarial
deficit in the family takaful fund will be made good by the shareholders’ fund via a benevolent loan or Qardhul Hassan.
AH INSURANCE COMMISSION AND AGENCY EXPENSES
Commission and agency expenses, which costs directly incurred in securing premium on insurance policies, net of income
derived from reinsurers in the course of ceding of premium to reinsurers, are charged to the revenue account in the financial
year in which they are incurred.
AI TRUST ACTIVITIES
The Group acts as trustees in other fiduciary capabilities that result in holding or placing of assets on behalf of individuals, trust
and other institutions. These assets and income arising thereon are excluded from the financial statements, as they are not
assets of the Group.
AJ INVESTMENT ACCOUNT
Unrestricted Investment Account-i (“URIA”) refers to a type of investment Account structured based on a profit sharing
(Mudarabah) contract. Mudarabah is a Shariah-compliant contract between Investment Account Holders (“IAH”) as capital
providers or investor (Rabbul-mal) and the Group’s subsidiary, Hong Leong Islamic Bank Berhad (“HLISB”) as the fund manager
(Mudarib). Any profit generated from the investment is shared between the IAH and HLISB according to a mutually pre-agreed
Profit Sharing Ratio. Financial losses from the investment activities are borne by the IAH except where such losses are due to
HLISB misconduct, negligence, or breach of specified terms. The URIA and financing assets funded by the URIA are recorded in
HLISB and the Group’s financial statement as its liabilities and assets in accordance with MFRS9. Risk weighted assets funded by
the Investment Account are excluded from the calculation of capital ratio of HLISB and the Group.
Restricted Investment Account-i (“RIA”) refers to a type of investment account where the IAH, provides a specific investment
mandate to the Group such as purpose and/or period for investment. The RIA is based on shariah principle of Wakalah bi
Al-Istithmar, an agency contract where the investor authorises the Group’s subsidiary, HLISB, as investment agent (Wakil) to
manage the customers’ investment on their behalf. Profit generated from the investment will be distributed to the IAH during
the Profit Distribution Period.

AK FINANCIAL ASSISTANCE SCHEME
Financing under a government scheme is recognised and measured in accordance with MFRS 9 “Financial Instruments”, with the
benefit at a below market rate measured as the difference between the initial carrying amount or fair value of the financing and
the amount received.
The benefits of government schemes that addresses identified costs or expenses incurred by the Group is recognised in the
statements of income in the same financial period in accordance with MFRS 120 “Accounting for Government Grants and
Disclosure of Government Assistance”.
170 • FINANCIALS
Notes to the Financial Statements

1 GENERAL INFORMATION
The principal activities of the Company are those of investment holding and provision of services to its subsidiaries to enhance
group value.
The Hong Leong Financial Group (the Company and its subsidiaries) is a diversified financial group whose businesses provide a
broad range of financial products and services to consumer, corporate and institutional customers.
The principal activities of the subsidiary companies are disclosed in Note 11 to the financial statements. There were no significant
changes in the nature of the activities of the Company and its subsidiaries during the financial year.
The Company is a public limited liability company, incorporated and domiciled in Malaysia, and listed on the Main Market of
Bursa Malaysia Securities Berhad.
The address of the registered office and principal place of business of the Company is Level 30, Menara Hong Leong, No. 6, Jalan
Damanlela, Bukit Damansara, 50490 Kuala Lumpur.
2 CASH AND SHORT-TERM FUNDS

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Cash and balances with banks and other financial

institutions 2,641,170 2,026,642 15 14
Money at call and deposit placements maturing within one
month 7,207,465 7,579,592 65,231 26,595
9,848,635 9,606,234 65,246 26,609
Less: Expected credit losses (203) (340) - -
9,848,432 9,605,894 65,246 26,609
Inclusive in cash and short-term funds of the Group are accounts held in trust for dealer’s representative amounting to
RM13,893,000 (2022: RM14,605,000).
3 DEPOSITS AND PLACEMENTS WITH BANKS AND OTHER FINANCIAL INSTITUTIONS

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Bank Negara Malaysia (“BNM”) 14,565 256,420 - -

Licensed banks 1,065,029 1,044,335 67,860 3,360
1,079,594 1,300,755 67,860 3,360
Less: Expected credit losses (20) (9) - -
1,079,574 1,300,746 67,860 3,360
The Company has placed a fixed deposit of RM3,300,000 (2022: RM3,300,000) with a bank for the RM100 million revolving
credit facility. The Company has agreed not to withdraw the fixed deposits during the tenure of the facility. The bank has a right
to set-off any sums placed by the Company in the fixed deposit account.

4 FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS ("FVTPL")
The Group
2023 2022
RM’000 RM’000
Money market instruments

Bank Negara Malaysia bills 1,197,414 49,806
Government treasury bills 620,126 2,083,409
Malaysian Government securities 4,310,150 4,323,656
Malaysian Government investment certificates 2,471,760 741,032
Negotiable instruments of deposit 1,856,476 1,473,440
Cagamas bonds 15,078 65,587
Other Government securities 6,466,091 5,761,134
16,937,095 14,498,064
Quoted securities
Shares in Malaysia 5,143,592 4,758,170
Shares outside Malaysia 590,260 553,017
Wholesale fund/unit trust investments 724,832 749,777
Portfolio Investment Accounts (Note) 1,282 9,097
Foreign currency bonds in Malaysia - 11,938
Foreign currency bonds outside Malaysia - 31,120
Convertible bonds outside Malaysia - 1,108,752
Investment-linked funds 456 305
Loan stocks 1,773 1,073
Warrants in Malaysia 1,894 3,545
6,464,089 7,226,794
Unquoted securities
Shares in Malaysia 393,371 382,664
Foreign currency bonds in Malaysia 37,281 -
Foreign currency bonds outside Malaysia 9,279 9,047
Government sukuk - 101,766
Corporate bonds and sukuk 7,941,807 7,141,464
Perpetual bonds 85,970 85,830
Redeemable preference shares 25,000 25,000
8,492,708 7,745,771
31,893,892 29,470,629
Note:
Included in financial assets at FVTPL are the underlying assets for the Portfolio Investment Accounts (“PIA”). PIA is the restricted
investment account offered to investors based on the Shariah principle of Wakalah bi Al-Istithmar, an agency contract where the
investor authorises Hong Leong Islamic Bank to manage the customers’ investment on their behalf.
172 • FINANCIALS

5 FINANCIAL INVESTMENTS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME ("FVOCI")
The Group
2023 2022
RM’000 RM’000
At fair value
(a) Debt instruments 35,627,135 27,369,557
(b) Equity instruments 97,650 83,386
35,724,785 27,452,943
(a) Debt instruments

Government treasury bills 1,820,701 -
Malaysia Government securities 4,707,923 3,791,081
Malaysia Government investment certificates 10,175,143 9,197,348
Negotiable instruments of deposit 1,306,322 1,796,800
Khazanah bonds 363,416 348,079
Cagamas bonds 2,620,153 890,863
20,993,658 16,024,171
Quoted securities
Government sukuk 860,644 831,321
Foreign currency bonds in Malaysia 1,873,035 1,216,476
Foreign currency bonds outside Malaysia 1,703,172 842,415
4,436,851 2,890,212
Unquoted securities
Government sukuk 30,768 417,257
Corporate bonds and sukuk 8,913,211 7,537,091
Foreign currency bonds in Malaysia 847,674 175,112
10,196,626 8,455,174
35,627,135 27,369,557
Included in the debt instruments at FVOCI are securities which are pledged as collateral for obligations on securities sold under
repurchase agreements for the Group of RM2,918,310,000 (2022: RM1,292,472,000).
The carrying amount of debt instruments at FVOCI is equivalent to their fair value. The expected credit losses is recognised in
other comprehensive income and does not reduce the carrying amount in the statement of financial position.

5 FINANCIAL INVESTMENTS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME ("FVOCI") (continued)
(a) Debt instruments (continued)
Movements in expected credit losses of debt instruments at FVOCI are as follows:
Stage 1 Stage 2 Stage 3

Lifetime ECL Lifetime ECL
12 months not credit credit
ECL impaired impaired Total ECL
The Group RM’000 RM’000 RM’000 RM’000
2023
As at 1 July 1,981 - 17,407 19,388
New financial assets originated or purchased 999 - - 999
Financial assets derecognised (223) - - (223)
Changes due to change in credit risk (582) - - (582)
Exchange differences 100 - 820 920
As at 30 June 2,275 - 18,227 20,502
2022
As at 1 July 2,741 - 16,647 19,388
Financial assets derecognised (1,058) - - (1,058)
Exchange differences 67 - 760 827
As at 30 June 1,981 - 17,407 19,388
(b) Equity instruments
The Group
2023 2022
RM’000 RM’000
Unquoted securities
Shares in Malaysia 97,650 83,386
174 • FINANCIALS

5 FINANCIAL INVESTMENTS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME ("FVOCI") (continued)
(b) Equity instruments (continued)
The Group designated certain investments shown in the following table as equity instruments under FVOCI, which is held
for socio-economic purposes or not for trading purposes.
Dividend
income
recognised
Fair during the
value financial year
The Group RM’000 RM’000
2023
Securities:
RAM Holdings Berhad 6,432 2,175
Payments Network Malaysia Sdn Bhd 89,975 -
Others 1,243 -
97,650 2,175
2022
Securities:
RAM Holdings Berhad 7,764 406
Payments Network Malaysia Sdn Bhd 74,544 -
Others 1,078 -
83,386 406

6 FINANCIAL INVESTMENTS AT AMORTISED COST
The Group
2023 2022
RM’000 RM’000

Government treasury bills 60,676 57,612
Malaysian Government securities 6,024,655 5,413,511
Malaysian Government investment certificates 23,487,152 23,305,894
Cagamas bonds 1,658,260 416,700
Khazanah bonds 14,393 13,889
Other Government securities 421,343 419,246
31,666,479 29,626,852
Quoted securities
19,117 62,174
Unquoted securities
Government sukuk 30,611 2,583,133
Corporate bonds and sukuk 616,114 1,336,766
646,725 3,919,899
Less: Expected credit losses (18) (68)

32,332,303 33,608,857
Included in the financial investments at amortised cost are foreign currency bonds, which are pledged as collateral for obligations on
securities sold under repurchase agreements for the Group amounting to RM4,478,710,000 (2022: RM2,692,688,000).
176 • FINANCIALS

6 FINANCIAL INVESTMENTS AT AMORTISED COST (continued)
Movements in expected credit losses of financial investments at amortised cost are as follows:

2023
As at 1 July 68 - - 68
Changes in models/risk parameters (1) - - (1)
Exchange differences 3 - - 3
As at 30 June 18 - - 18
2022
As at 1 July 80 - - 80
Exchange differences 2 - - 2
As at 30 June 68 - - 68

7 LOANS, ADVANCES AND FINANCING
The Group
2023 2022
RM’000 RM’000
Overdrafts 4,077,891 3,546,936

Term loans/financing
- Housing and shop loans/financing 97,387,797 91,169,501
- Hire purchase receivables 19,914,072 18,035,880
- Ijarah receivables 249,054 247,445
- Other term loans/financing and syndicated term loans 35,475,855 32,347,688
Credit/charge card receivables 3,202,663 2,923,883
Bills receivable 1,936,868 1,539,682
Trust receipts 441,074 417,252
Policy and premium loans 254,751 295,962
Claims on customers under acceptance credits 8,936,884 8,817,344
Revolving credits 10,339,502 9,455,248
Staff loans/financing 125,080 127,105
Other loans/financing 126 128
Gross loans, advances and financing 182,341,617 168,924,054
Fair value changes arising from fair value hedges and unamortised fair value changes arising
from terminated fair value hedges (14,700) (9,962)
Allowance for impairment losses:
- Expected credit losses (1,759,502) (1,736,789)
Total net loans, advances and financing 180,567,415 167,177,303
Included in loans, advances and financing are housing loans sold to Cagamas Berhad with recourse to the Group amounting to
RM2,917,197,000 (2022: RM1,572,077,000).
(a) The maturity structure of loans, advances and financing is as follows:
The Group
2023 2022
RM’000 RM’000
Maturing within:
- one year 33,575,374 31,300,399
- over one year to three years 7,261,457 6,836,044
- over three years to five years 10,659,367 11,278,670
- over five years 130,845,419 119,508,941
178 • FINANCIALS

7 LOANS, ADVANCES AND FINANCING (continued)
(b) The loans, advances and financing are disbursed to the following types of customers:
The Group
2023 2022
RM’000 RM’000
Domestic non-bank financial institutions 2,258,897 1,946,823

Domestic business enterprises:
- Small and medium enterprises 33,083,633 30,175,416
- Others 27,940,458 25,204,745
Government and statutory bodies 1,108 1,387
Individuals 115,827,432 108,121,079
Other domestic entities 100,246 103,122
Foreign entities 3,129,843 3,371,482
(c) Loans, advances and financing analysed by their interest rate/profit rate sensitivity are as follows:
The Group
2023 2022
RM’000 RM’000
Fixed rate:
- Housing and shop loans/financing 4,875,632 1,387,967
- Hire purchase receivables 19,856,028 17,965,989
- Credit card 3,202,663 2,923,883
- Other fixed rate loans/financing 5,693,140 6,885,306
Variable rate:
- Base rate/base lending rate plus 123,357,618 116,345,805
- Cost plus 25,256,906 23,275,400
- Other variable rates 99,630 139,704

(d) Loans, advances and financing analysed by their economic purposes are as follows:
The Group
2023 2022
RM’000 RM’000
Purchase of securities 1,320,663 1,311,692

Purchase of transport vehicles 19,574,851 17,653,587
Residential property (housing) 89,114,612 82,434,291
Non-residential property 21,976,096 20,519,124
Purchase of fixed assets (excluding landed properties) 1,672,034 1,613,109
Personal use 3,885,235 3,706,863
Credit card 3,202,663 2,923,883
Construction 4,197,939 3,531,187
Working capital 35,954,488 33,798,279
Other purposes 1,443,036 1,432,039
(e) Loans, advances and financing analysed by their geographical distribution are as follows:
The Group
2023 2022
RM’000 RM’000
In Malaysia 168,376,448 157,168,978

Outside Malaysia
- Singapore 9,367,686 7,624,640
- Hong Kong 46,789 21,090
- Vietnam 1,956,082 1,652,819
- Cambodia 2,594,612 2,456,527
180 • FINANCIALS

(f) Impaired loans, advances and financing analysed by their economic purposes are as follows:
The Group
2023 2022
RM’000 RM’000
Purchase of securities 125 232

Purchase of transport vehicles 42,881 35,282
Residential property (housing) 404,463 315,073
Non-residential property 119,107 151,278
Purchase of fixed assets (excluding landed properties) 4,627 485
Personal use 47,205 44,522
Credit card 30,445 21,419
Construction 24,851 9,271
Working capital 274,325 207,698
Other purposes 93,981 34,618
Gross impaired loans, advances and financing 1,042,010 819,878
(g) Impaired loans, advances and financing analysed by their geographical distribution are as follows:
The Group
2023 2022
RM’000 RM’000
In Malaysia 982,393 805,766

Outside Malaysia
- Singapore 1,481 841
- Vietnam 928 1,585
- Cambodia 57,208 11,686
Gross impaired loans, advances and financing 1,042,010 819,878

(h) Movements in expected credit losses for loans, advances and financing are as follows:

2023
As at 1 July 977,229 423,913 335,647 1,736,789
Changes in ECL due to transfer within stages (44,038) (203,154) 247,192 -
- Transfer to Stage 1 35,350 (35,254) (96) -
- Transfer to Stage 2 (76,367) 145,894 (69,527) -
- Transfer to Stage 3 (3,021) (313,794) 316,815 -
New financial assets originated 46,539 855 54 47,448
Financial assets derecognised (15,727) (30,658) (25,835) (72,220)
Changes due to change in credit risk (5,293) 186,466 172,701 353,874
Changes in models/risk parameters 5,747 2,706 - 8,453
Modifications to contractual cash flows of financial
assets 366 1,078 203 1,647
Amount written off - - (306,145) (306,145)
Exchange differences 1,757 571 (615) 1,713
Other movements - - (12,057) (12,057)
As at 30 June 966,580 381,777 411,145 1,759,502
2022
As at 1 July 1,075,247 459,868 234,635 1,769,750
Changes in ECL due to transfer within stages (56,893) (237,992) 294,885 -
- Transfer to Stage 1 33,363 (33,201) (162) -
- Transfer to Stage 2 (87,725) 148,017 (60,292) -
- Transfer to Stage 3 (2,531) (352,808) 355,339 -
New financial assets originated 39,280 240 299 39,819
Financial assets derecognised (16,030) (26,665) (15,840) (58,535)
Changes due to change in credit risk (60,385) 235,423 250,768 425,806
Changes in models/risk parameters (4,986) (7,335) (384) (12,705)
Exchange differences 996 374 903 2,273
Other movements - - (3,735) (3,735)
As at 30 June 977,229 423,913 335,647 1,736,789
182 • FINANCIALS

(i) Movements in the gross carrying amount of loans, advances and financing that contributed to changes in the expected
credit losses are as follows:

2023
As at 1 July 151,608,434 16,495,742 819,878 168,924,054
Total transfer within stages 8,013,127 (8,720,026) 706,899 -
- Transfer to Stage 1 12,005,919 (12,003,075) (2,844) -
- Transfer to Stage 2 (3,928,002) 4,825,923 (897,921) -
- Transfer to Stage 3 (64,790) (1,542,874) 1,607,664 -
New financial assets originated 21,187,049 804,365 1,017 21,992,431
Financial assets derecognised (7,476,512) (328,706) (63,207) (7,868,425)
Changes due to change in credit risk 4,374 (1,568,124) (116,749) (1,680,499)
Modifications to contractual cash flows and
unwinding of modification impact 63,763 29,870 - 93,633
Changes in models/risk parameters - - - -
Exchange differences 1,181,668 4,583 632 1,186,883
Other movements - - - -
As at 30 June 174,581,903 6,717,704 1,042,010 182,341,617
2022
As at 1 July 146,077,778 9,735,392 717,672 156,530,842
Total transfer within stages (8,056,720) 7,386,816 669,904 -
- Transfer to Stage 1 10,407,775 (10,405,873) (1,902) -
- Transfer to Stage 2 (18,431,414) 19,057,743 (626,329) -
- Transfer to Stage 3 (33,081) (1,265,054) 1,298,135 -
New financial assets originated 17,621,893 2,653,997 332 20,276,222
Financial assets derecognised (4,978,800) (343,178) (55,346) (5,377,324)
Changes due to change in credit risk 352,394 (2,942,768) (88,136) (2,678,510)
Modifications to contractual cash flows and
unwinding of modification impact 56,999 (132) - 56,867
Exchange differences 534,890 5,615 1,561 542,066
As at 30 June 151,608,434 16,495,742 819,878 168,924,054

8 CLIENTS’ AND BROKERS’ BALANCES
Clients’ and brokers’ balances represent amount receivable from outstanding purchase contracts in respect of the Group’s
stockbroking and futures clients, amount due from brokers and contra losses and trade receivables from insurance clients.
The Group
2023 2022
RM’000 RM’000
Performing accounts 618,267 720,318

Impaired accounts 1,423 2,861
619,690 723,179
Less: Allowances for bad and doubtful debts
- Expected credit losses (866) (998)
618,824 722,181
Movements of impaired accounts are as follows:
The Group
2023 2022
RM’000 RM’000
As at 1 July 2,861 5,247

New financial assets originated 54 2,035
Financial assets derecognised (779) (2,448)
Impaired during the financial year 15,948 33,768
Allowance written back (16,661) (35,741)
As at 30 June 1,423 2,861
Movements in expected credit losses on clients’ and brokers’ balances are as follows:

not credit credit
impaired impaired Total ECL
The Group RM’000 RM’000 RM’000
2023
As at 1 July 49 949 998
New financial assets originated 38 12 50
Financial assets derecognised (49) (11) (60)
Impaired during the financial year 27 240 267
Allowance written back (56) (333) (389)
As at 30 June 9 857 866
184 • FINANCIALS

8 CLIENTS’ AND BROKERS’ BALANCES (continued)
Movements in expected credit losses on clients’ and brokers’ balances are as follows: (continued)

not credit credit
The Group RM’000 RM’000 RM ‘000
2022
As at 1 July 85 1,103 1,188
Impaired during the financial year 51 190 241
Allowance written back (67) (337) (404)
As at 30 June 49 949 998
9 OTHER ASSETS

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Foreclosed properties 46 46 - -
Sundry debtors and other prepayments 338,198 274,377 2,250 2,635
Settlement accounts 850,808 708,194 - -
Treasury related receivables 159,020 578,958 - -
Cash collateral pledged for derivative transactions 1,086,263 689,029 - -
Fee income receivables net of expected credit
losses of RM1,385,000 (2022: RM1,970,000) (a) 7,715 8,961 - -
Other receivables net of expected credit losses of
RM1,811,000 (2022: RM1,624,000) (b) 235,699 171,935 - -
2,677,749 2,431,500 2,250 2,635

9 OTHER ASSETS (continued)
(a) Movements in expected credit losses for fee income receivables are as follows:

not credit credit
The Group RM ‘000 RM’000 RM’000
2023
As at 1 July 6 1,964 1,970
New financial assets originated 4 - 4
Allowance written back - (337) (337)
Amount written off - (551) (551)
Allowance made - 472 472
As at 30 June 5 1,380 1,385
2022
As at 1 July 4 1,938 1,942
Impaired during the financial year - 86 86
As at 30 June 6 1,964 1,970
(b) Movements in expected credit losses for other receivables are as follows:

not credit credit
2023
As at 1 July 1,077 547 1,624
Financial assets derecognised - (94) (94)
As at 30 June 1,358 453 1,811
2022
As at 1 July 1,010 453 1,463
As at 30 June 1,077 547 1,624
186 • FINANCIALS

10 STATUTORY DEPOSITS WITH CENTRAL BANKS
The non-interest bearing statutory deposits are maintained by certain banking subsidiaries with Bank Negara Malaysia in
compliance with Section 26(2)(c) of the Central Bank of Malaysia Act, 2009, the amounts of which are determined at set
percentages of total eligible liabilities. The non-interest bearing statutory deposits of a foreign banking subsidiary and the
foreign branch of a banking subsidiary of the Group are maintained with respective central banks in compliance with the
applicable legislation.
11 INVESTMENT IN SUBSIDIARY COMPANIES
The Company
2023 2022
RM’000 RM’000
Investment in subsidiary companies, at cost

Unquoted shares 262,980 262,980
Shares quoted in Malaysia 16,804,109 16,804,109
17,067,089 17,067,089
Investment in debt instrument issued by subsidiary companies, at amortised cost

Multi-currency Additional Tier 1 capital securities 404,862 806,661
Subordinated obligations 1,102,166 1,602,433
18,574,117 19,476,183
Less: Allowance for impairment losses (15,241) (16,755)
18,558,876 19,459,428
Movements in the allowance for impairment losses are as follows:
The Company
2023 2022
RM’000 RM’000
As at 1 July 16,755 18,008

Expected credit losses made during the financial year (1,514) (1,253)
As at 30 June 15,241 16,755

11 INVESTMENT IN SUBSIDIARY COMPANIES (continued)
(i) Information about principal subsidiaries:
The subsidiary companies of the Company are as follows:
Effective percentage
of ownership
Country of 2023 2022
Name of companies incorporation % % Principal activities
(a) HLA Holdings Sdn Bhd and its subsidiary Malaysia 100.0 100.0 Investment holding
companies:
(i) Hong Leong Assurance Berhad Malaysia 70.0 70.0 Life insurance business
- Unincorporated trust for ESS * Ω
Malaysia - - Special purpose vehicle for ESS
(ii) Hong Leong Insurance (Asia) Limited* Hong Kong 100.0 100.0 General insurance business
(iii) Hong Leong MSIG Takaful Berhad Malaysia 65.0 65.0 Family takaful business
(iv) RC Holdings Sdn Bhd Malaysia 100.0 100.0 In members’ voluntary liquidation
(v) HL Assurance Pte. Ltd.* Singapore 100.0 100.0 General insurance business
(b) Unincorporated trust for ESS *
Ω
Malaysia - - Special purpose vehicle for ESS
(c) HLFG Principal Investments (L) Limited Malaysia 100.0 100.0 Investment holding
(d) Hong Leong Capital Berhad and its Malaysia 73.7 73.7 Investment holding
subsidiary companies:
(i) HLG Securities Sdn Bhd Malaysia 73.7 73.7 In members’ voluntary liquidation
(ii) HLG Capital Markets Sdn Bhd Malaysia - 73.7 Dissolved
(iii) Hong Leong Investment Bank Berhad Malaysia 73.7 73.7 Investment banking, stockbroking
and its subsidiary companies: business,futures broking and related
financial services
- SSSB Jaya (1987) Sdn Bhd Malaysia 73.7 73.7 In creditors’ voluntary liquidation
- HLIB Nominees (Tempatan) Malaysia 73.7 73.7 Nominee and custodian services for
Sdn Bhd Malaysian clients
- HLIB Nominees (Asing) Malaysia 73.7 73.7 Nominee and custodian services for
Sdn Bhd foreign clients
(iv) HLCB Assets Sdn Bhd Malaysia 73.7 73.7 Investment activities
(v) Hong Leong Asset Management Bhd Malaysia 73.7 73.7 Unit trust management, fund
and its subsidiary company: management and sale of unit trusts
- Hong Leong Islamic Asset Malaysia 73.7 73.7 Islamic fund management services
Management Sdn Bhd
(vi) Unincorporated trust for ESSΩ* Malaysia - - Special purpose vehicle for ESS purpose
(e) Hong Leong Bank Berhad and its Malaysia 65.5 65.5 All aspects of commercial banking
subsidiary companies: business and provision of related
services
(i) Hong Leong Islamic Bank Berhad Malaysia 65.5 65.5 Islamic banking business and related
financial services
(ii) DC Tower Sdn Bhd Malaysia 65.5 65.5 Property management
188 • FINANCIALS

(i) Information about principal subsidiaries: (continued)
The subsidiary companies of the Company are as follows: (continued)
Effective percentage
of ownership
Country of 2023 2022
Name of companies incorporation % % Principal activities
(e) Hong Leong Bank Berhad and its subsidiary
companies: (continued)
(iii) Hong Leong Bank Vietnam Limited* Vietnam 65.5 65.5 Commercial banking business
(iv) Hong Leong Bank (Cambodia) PLC* +
Cambodia 65.5 65.5 Commercial banking business
(v) HLF Credit (Perak) Bhd and its Malaysia 65.5 65.5 Investment holding
subsidiary companies:
- Gensource Sdn Bhd and its Malaysia 65.5 65.5 Investment holding
subsidiary company:
- Pelita Terang Sdn Bhd Malaysia 65.5 65.5 Dormant
- Promidah Sdn Bhd * Malaysia 65.5 65.5 Dormant
- Promizul Sdn Bhd Malaysia 65.5 65.5 In members’ voluntary liquidation
- HLB Realty Sdn Bhd Malaysia 65.5 65.5 Property investment
(vi) HLB Nominees (Tempatan) Malaysia 65.5 65.5 Agent and nominee for Malaysian
Sdn Bhd clients
(vii) HLB Nominees (Asing) Sdn Bhd Malaysia 65.5 65.5 Agent and nominee for foreign clients
(viii) HLB Trade Services (Hong Kong) Hong Kong 65.5 65.5 Ceased operations
Limited*
(ix) HLB Principal Investments (L) Malaysia 65.5 65.5 Investment holding
Limited and its subsidiary company:
- Promino Sdn Bhd Malaysia 65.5 65.5 Holding of pooled motor vehicles for
HLB group’s usage
(x) Promilia Berhad Malaysia 65.5 65.5 Holding of motor vehicles for HLB
group’s usage
(xi) EB Nominees (Tempatan) Sendirian Malaysia 65.5 65.5 In members’ voluntary liquidation
Berhad
(xii) EB Realty Sendirian Berhad Malaysia 65.5 65.5 In members’ voluntary liquidation
(xiii) OBB Realty Sdn Bhd Malaysia 65.5 65.5 Property investment
(xiv) Unincorporated trust for ESS * Ω
Malaysia - - Special purpose vehicle for ESS purpose
(f) Hong Leong Income FundΩ Malaysia 61.1 70.2 Unit trust funds
(g) Hong Leong Wholesale Equity Fund 2Ω Malaysia 65.5 65.5 Unit trust funds
(h) Hong Leong Value Fund Ω
Malaysia 78.3 73.1 Unit trust funds
(i) Hong Leong Strategic Fund Ω
Malaysia 39.9 37.3 Unit trust funds
(j) Hong Leong Dividend FundΩ Malaysia 49.3 - Unit trust funds
(k) Hong Leong Global ESG Fund Ω
Malaysia 86.2 - Unit trust funds
(l) Hong Leong Global Shariah ESG Fund Ω
Malaysia 38.9 - Unit trust funds
* Not audited by PricewaterhouseCoopers PLT

+ Audited by member firms of PricewaterhouseCoopers International Limited
Ω Deemed subsidiary companies pursuant to MFRS 10 “Consolidated Financial Statements”

(ii) Details of subsidiary companies that have material non-controlling interests:
Set out below are the Group’s subsidiary companies that have material non-controlling interests:
Proportion of ownership
interests and voting rights
held by non-controlling Profit allocated to Accumulated
interests non-controlling interests non-controlling interests
2023 2022 2023 2022 2023 2022
% % RM’000 RM’000 RM’000 RM’000
Hong Leong Bank Berhad 34.5 34.5 1,316,556 1,133,548 11,721,996 10,681,901
Hong Leong Capital Berhad 26.3 26.3 13,112 19,051 253,797 248,439
Hong Leong Assurance
Berhad 30.0 30.0 85,195 77,031 786,302 710,106
Individually immaterial
subsidiaries with non-
controlling interests 1,452 1,022 75,827 73,687
1,416,315 1,230,652 12,837,922 11,714,133
Summarised financial information for each subsidiary companies that has non-controlling interests that are material
to the Group is set out below. The summarised financial information below represents amounts before inter-company
eliminations.
190 • FINANCIALS

(ii) Details of subsidiary companies that have material non-controlling interests: (continued)
Set out below are the Group’s subsidiary companies that have material non-controlling interests: (continued)
Hong Leong Hong Leong Hong Leong

Assurance Berhad Bank Berhad Capital Berhad
2023 2022 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Total assets 26,328,891 24,123,922 279,850,454 254,331,377 4,975,761 4,276,873

Total liabilities (23,707,884) (21,756,901) (245,863,802) (223,342,401) (4,010,385) (3,331,880)
Net assets 2,621,007 2,367,021 33,986,652 30,988,976 965,376 944,993
Equity attributable
to owners of the
Company (1,834,705) (1,656,915) (22,264,656) (20,307,075) (711,579) (696,554)
Non-controlling interests (786,302) (710,106) (11,721,996) (10,681,901) (253,797) (248,439)
Revenue 368,543 320,303 5,685,509 5,597,408 196,326 223,360

Profit before taxation 352,914 313,585 4,626,631 4,366,800 61,428 97,172
Taxation (68,928) (56,815) (808,435) (1,077,517) (11,552) (24,709)
Other comprehensive
income/(loss) - - 380,331 (677,311) 15,306 (23,156)
Total comprehensive
income 283,986 256,770 4,198,527 2,611,972 65,182 49,307
Net cash used in

investing activities (4,829) (5,160) (5,723,340) (288,023) (344,941) (66,970)
Net cash (used in)/
generated from
financing activities (54,979) (54,992) (115,882) 196,815 (53,588) (69,936)
Net cash (used in)/
generated from
operating activities (332,009) 191,028 7,622,201 2,501,916 458,760 358,429
Net (decrease)/increase
in cash and cash
equivalents (391,817) 130,876 1,782,979 2,410,708 60,231 221,523
Profit allocated to non-

controlling interests of
the Group 85,195 77,031 1,316,556 1,133,548 13,112 19,051
Dividends to non-
controlling interests of
the Group 9,000 9,000 410,947 376,719 11,776 16,116

12 INVESTMENT IN ASSOCIATED COMPANIES
The Group
2023 2022
RM’000 RM’000
Quoted shares and unit trust investments 2,405,825 1,159,108

Unquoted shares investments 643,323 643,323
Cumulative share of results, net of dividend received 6,170,950 4,888,027
Equity conversion option 57,937 82,751
Cumulative share of changes in other comprehensive income (26,834) (15,701)
Exchange fluctuation reserve 799,539 903,317
10,050,740 7,660,825
(a) Information about associated companies
The Group
Percentage (%) of equity held
Country of Principal 2023 2022
Name of companies incorporation activities % %
Bank of Chengdu Co., Ltd China Commercial 19.8 18.0

banking
Community CSR Sdn Bhd Malaysia Investment 20.0 20.0
holding
Sichuan Jincheng Consumer Finance Limited Company China Consumer 12.0 12.0
financing
MSIG Insurance (Malaysia) Bhd Malaysia Insurance 30.0 30.0
Hong Leong Wholesale Bond Fund Malaysia Unit trust 47.8 54.8
Hong Leong Dana Maa'rof Fund Malaysia Unit trust 10.2 12.3
Hong Leong Islamic Income Management Fund Malaysia Unit trust 36.9 7.0
Hong Leong Asia-Pacific Dividend Fund Malaysia Unit trust 22.6 22.0
Hong Leong Dana AlSafa Fund Malaysia Unit trust 30.4 -
Nature of relationship
(i) Bank of Chengdu Co., Ltd ("BOCD")
On 25 October 2007, Hong Leong Bank Berhad (“HLB”) entered into a Share Subscription Agreement with BOCD to
subscribe for new shares representing 19.99% equity interest of the Enlarged Capital in BOCD. BOCD is a leading
commercial bank in Western and Central China with its base in Chengdu, the capital of Sichuan Province. The
subscription enables HLB to enter into a strategic alliance with BOCD to tap the promising and growing financial
services sector of China. It strengthens and diversifies the earning base of HLB.
On 31 January 2018, BOCD was officially listed on the Shanghai Stock Exchange after completing its initial public
offering (“IPO”) of 361 million shares and raised 2.53 billion yuan. Arising from the IPO, the Group’s equity interest
of the enlarged capital in BOCD is now reduced to 18% from 20%. BOCD remains an associate by virtue of the
representation held on BOCD’s Board of Directors.
192 • FINANCIALS

12 INVESTMENT IN ASSOCIATED COMPANIES (continued)
(a) Information about associated companies (continued)
(i) Bank of Chengdu Co., Ltd (“BOCD”) (continued)
In March 2022, HLB subscribed convertible bonds issued by BOCD. During the financial year, HLB has fully converted
the bonds and the Group’s equity interest in BOCD has been revised to 19.8% as at 30 June 2023.
The market value of BOCD’s shares held by the Group is RM5.94 billion (2022: RM7.09 billion) at RM7.88 (2022:
RM10.91) per share as at 30 June 2023.
As at 30 June 2023, the market value of investment in BOCD was below the carrying amount. The Group has
performed impairment assessment on the carrying amount of the investment in BOCD, which confirmed that no
impairment is required as at 30 June 2023 as the recoverable amount as determined by a value-in-use (“VIU”)
calculation was higher than the carrying value. Management believes that any reasonable possible change to the
key assumptions applied would not cause the carrying value to exceed its recoverable amount.
The VIU calculation uses discounted cash flows projections based on BOCD management’s best estimates of future
earnings taking into account of past performance and BOCD’s expectation of market development. This calculation
uses cash flows projections being the amount attributable to the shareholders based on the budget for the financial
year ending 2024 with a further projection of 4 years, which was approved by BOCD management. Cash flows
beyond the 5 year period are extrapolated using an estimated growth rate of 4.93% (2022: 5.65%) representing the
forecasted Gross Domestic Product growth rate of the country.
The discount rate of 13.6% (2022: 13.6%) used in determining the recoverable amount is derived based on a capital
asset pricing model calculation, using available market data.
(ii) Community CSR Sdn Bhd ("CCSR")
In 2011, HLB subscribed to RM50 million Cumulative Redeemable Preference Shares (“CRPS”) in Jana Pendidikan
Malaysia Sdn Bhd. For every RM1 million subscription of CRPS, HLB is entitled to subscribe for 1 ordinary share of
RM1 each in CCSR. As such, HLB subscribed for 50 CCSR shares of RM1 each for cash at par which represent 20%
equity interest of CCSR. In November 2014, HLB subscribed to additional 19,950 CCSR Right Issues of RM1 each.
(iii) Sichuan Jincheng Consumer Finance Limited Company ("JCCFC")
On 1 March 2010, HLB together with BOCD, obtained operation approval from China Banking Regulatory Commission
(“CBRC”) for JCCFC, a joint venture company that is part of the first batch of approved companies, to start consumer
finance operations in Central and Western China. JCCFC focuses primarily in the consumer financing business
with HLB having a 49% equity interest and BOCD having a 51% equity interest in JCCFC. This strategic alliance
between HLB and BOCD to tap into the promising and growing financial services sector in China further cements
the Group’s strategic partnership in BOCD and affirms the Group’s vision and belief in the huge potential of China.
In March 2017, the Board of Directors of the Group had approved the divestment of 37% of the HLB’s stake through
non-subscription of the issuance of new share capital by JCCFC and selling down the original share capital held by the
Group to new strategic investors through an exercise via Southwest United Equity Exchange. The sale was completed
upon obtaining approval from CBRC vide its letter dated 3 September 2018. In 2019, the net gain on divestment of
joint venture of RM90,106,000 was recognised in the Group’s statements of income.
Post completion of the divestment exercise, the retained interest of 12% was derecognised from the investment
in joint venture and classified as investment in associated companies. JCCFC remains an associate by virtue of the
representation on JCCFC’s Board of Directors.

(a) Information about associated companies (continued)
(iv) MSIG Insurance (Malaysia) Bhd ("MSIG")
On 1 October 2010, HLA Holdings Sdn Bhd (“HLAH”) entered into a Strategic Partnership with Mitsui Sumitomo
Insurance Company, Limited (“MSIJ”) to transfer the Non-Life Business of Hong Leong Assurance Berhad (“HLA”) to
MSIG Insurance (Malaysia) Bhd (“MSIG”), a subsidiary of MSIJ and one of the largest general insurance in Malaysia,
satisfied via the issuance of such number of new shares as shall represent 30% of the ordinary issued and paid-up
capital of MSIG.
(v) Unit trust investments
Deemed associated companies pursuant to MFRS 128 “Investments in Associates and Joint Ventures”.
CCSR and MSIG are non-listed companies and no quoted market price available for their shares.
The Group deems BOCD and MSIM as material associated companies.
(b) The summarised financial information below represents amounts shown in the material associated companies financial
statements which are accounted for using equity method is as follows:
(i) Bank of Chengdu Co., Ltd
The Group
2023 2022
RM’000 RM’000
Total assets 663,055,407 587,601,391

Total liabilities (619,627,516) (552,359,573)
Net assets 43,427,891 35,241,818
Interest income 23,809,371 20,952,823

Interest expense (12,550,167) (10,666,498)
Non-interest income 2,460,679 2,410,797
Profit before taxation 8,538,581 6,675,167
Profit after taxation 6,869,924 5,629,205
Total comprehensive income 6,785,363 5,536,137
Dividends paid/declared by the associated company during the financial year - 1,493,002
Shares of results of associated company (%) 19.8% 18%

Shares of results of associated company (RM’000) 1,266,273 1,012,694
Dividends from the associated company (RM’000) - 268,591
194 • FINANCIALS

(b) The summarised financial information below represents amounts shown in the material associated companies financial
statements which are accounted for using equity method is as follows: (continued)
(ii) MSIG Insurance (Malaysia) Bhd
The Group
2023 2022
RM’000 RM’000
Total assets 6,478,349 6,423,664

Total liabilities (3,189,124) (3,141,819)
Net assets 3,289,225 3,281,845
Interest income 37,263 20,285

Non-interest income 506,512 558,510
Profit before taxation 322,051 324,719
Profit after taxation 227,536 260,894
Total comprehensive income 240,580 218,344
Shares of results of associated company (%) 30% 30%

Shares of results of associated company (RM'000) 68,261 78,268
Dividends from the associated company (RM'000) 69,960 119,931
(c) Reconciliation of the summarised financial information to the carrying amount of the interest in the material associated
companies recognised in the consolidated financial statements:
(i) Bank of Chengdu Co., Ltd
The Group
2023 2022
RM’000 RM’000
Opening net assets as at 1 July 35,241,818 30,038,111

Effect arising from conversion of convertible bonds 2,524,428 -
Profit for the financial year 6,869,924 5,629,205
Other comprehensive income for the financial year (84,561) (93,068)
Dividends paid/declared - ( 1,493,002)
Equity conversion option (166,780) 459,983
Exchange fluctuation reserve (956,938) 700,589
Closing net assets as at 30 June 43,427,891 35,241,818
Interest in associated company (%) 19.8% 18.0%

Interest in associated company (RM'000) 8,581,351 6,340,003

(c) Reconciliation of the summarised financial information to the carrying amount of the interest in the material associated
companies recognised in the consolidated financial statements: (continued)
(ii) MSIG Insurance (Malaysia) Bhd
The Group
2023 2022
RM’000 RM’000
Opening net assets as at 1 July 3,281,845 3,463,272

Profit for the financial year 227,536 260,894
Other comprehensive income for the financial year 13,044 (42,550)
Dividends (233,200) (399,771)
Closing net assets as at 30 June 3,289,225 3,281,845
Interest in associated company (%) 30% 30%

Interest in associated company (RM'000) 986,767 984,553
The summarised financial information above represents amount shown in the material associates’ financial statements
prepared in accordance with MFRSs. The information is based on the financial statements of the associated companies
after reflecting adjustments made by the Group when using the equity method, such as fair value adjustments made at
the time of acquisition and differences in accounting policies between the Group and the associated companies.
196 • FINANCIALS

13 PROPERTY AND EQUIPMENT
Office and Furniture, Capital

Land and computer fittings and Motor work-in-
The Group building* equipment renovation vehicles progress Total
2023 Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Cost
As at 1 July 1,027,146 1,183,501 477,445 12,374 90,719 2,791,185
Additions 10,342 32,890 5,151 2,979 96,215 147,577
Reclassification to intangible assets 17 - 7,428 2,014 - (95,853) (86,411)
Disposals/write-off - (116,405) (6,396) (1,948) (62) (124,811)
Exchange fluctuation 4,274 4,691 2,214 196 500 11,875
As at 30 June 1,041,762 1,112,105 480,428 13,601 91,519 2,739,415
Accumulated depreciation
As at 1 July 150,967 965,420 392,725 7,693 - 1,516,805
Charge during the financial year 17,274 82,608 22,136 2,108 - 124,126
Reclassification to intangible assets 17 - 65 - - - 65
Disposals/write-off - (115,248) (6,282) (1,948) - (123,478)
Exchange fluctuation 1,115 3,873 1,877 153 - 7,018
As at 30 June 169,356 936,718 410,456 8,006 - 1,524,536
Net book value as at 30 June 2023 872,406 175,387 69,972 5,595 91,519 1,214,879
* Land and building consists of the following:
Freehold Long-term leasehold Short-term leasehold

The Group land building land^ building land^ building Total
2023 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Cost
As at 1 July 136,299 585,388 43,885 257,846 1,092 2,636 1,027,146
Additions 10,342 - - - - - 10,342
Exchange fluctuation - - - 4,274 - - 4,274
As at 30 June 146,641 585,388 43,885 262,120 1,092 2,636 1,041,762
As at 1 July - 74,853 6,694 67,400 486 1,534 150,967
Charge during the financial year - 11,689 462 5,056 17 50 17,274
As at 30 June - 86,542 7,156 73,571 503 1,584 169,356
Net book value as at 30 June 2023 146,641 498,846 36,729 188,549 589 1,052 872,406
^ These are the right-of-use assets within the scope of MFRS 16. Refer to accounting policies for leases as disclosed in Note I.

13 PROPERTY AND EQUIPMENT (continued)
Office and Furniture, Capital

Land and computer fittings and Motor work-in-
The Group building* equipment renovation vehicles progress Total
2022 Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Cost
As at 1 July 1,026,176 1,172,938 485,842 10,393 88,914 2,784,263
Additions - 25,570 4,515 3,544 102,953 136,582
Reclassification/transfer 17 (1,536) 14,861 2,352 - (101,723) (86,046)
Disposals/write-off (630) (32,648) (16,675) (1,620) (34) (51,607)
Exchange fluctuation 3,136 2,780 1,411 57 609 7,993
As at 30 June 1,027,146 1,183,501 477,445 12,374 90,719 2,791,185
As at 1 July 133,325 905,274 382,714 7,718 - 1,429,031
Charge during the financial year 17,197 90,118 25,018 1,544 - 133,877
Disposals/write-off (318) (32,340) (16,257) (1,620) - (50,535)
Exchange fluctuation 763 2,368 1,250 51 - 4,432
As at 30 June 150,967 965,420 392,725 7,693 - 1,516,805
Net book value as at 30 June 2022 876,179 218,081 84,720 4,681 90,719 1,274,380
* Land and building consists of the following:
Freehold Long-term leasehold Short-term leasehold

The Group land building land^ building land^ building Total
2022 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Cost
As at 1 July 136,299 585,388 44,143 256,618 1,092 2,636 1,026,176
Reclassification - - - (1,536) - - (1,536)
Disposals - - (258) (372) - - (630)
As at 30 June 136,299 585,388 43,885 257,846 1,092 2,636 1,027,146
As at 1 July - 63,157 6,320 61,899 469 1,480 133,325
Exchange fluctuation - - - 763 - - 763
Disposals - - (91) (227) - - (318)
Charge during the financial year - 11,696 465 4,965 17 54 17,197
As at 30 June - 74,853 6,694 67,400 486 1,534 150,967
Net book value as at 30 June 2022 136,299 510,535 37,191 190,446 606 1,102 876,179
^ These are the right-of-use assets within the scope of MFRS 16. Refer to accounting policies for leases as disclosed in Note I.
198 • FINANCIALS

13 PROPERTY AND EQUIPMENT (continued)
Office and Furniture,

computer fittings and Motor
equipment renovation vehicles Total
2023
Cost
As at 1 July 1,094 4,523 3,274 8,891
Additions 14 1,057 668 1,739
Disposals - (1) (615) (616)
As at 30 June 1,108 5,579 3,327 10,014
As at 1 July 1,045 2,106 937 4,088
Disposals - (1) (615) (616)
Charge during the financial year 39 509 653 1,201
As at 30 June 1,084 2,614 975 4,673
Net book value as at 30 June 2023 24 2,965 2,352 5,341
2022
Cost
As at 1 July 1,108 4,526 1,971 7,605
Additions 11 - 2,363 2,374
Disposals (25) (3) (1,060) (1,088)
As at 30 June 1,094 4,523 3,274 8,891
As at 1 July 1,030 1,680 1,706 4,416
Disposals (25) (3) (1,060) (1,088)
Charge during the financial year 40 429 291 760
As at 30 June 1,045 2,106 937 4,088
Net book value as at 30 June 2022 49 2,417 2,337 4,803


14 RIGHT-OF-USE ASSETS
Office
Properties equipment Total
2023
As at 1 July 214,131 224 214,355
Modification (328) - (328)
Additions 30,458 1,145 31,603
Disposals (9,066) (9) (9,075)
Charge during the financial year (51,726) (288) (52,014)
Exchange fluctuation 4,766 33 4,799
As at 30 June 188,235 1,105 189,340
2022
As at 1 July 210,324 370 210,694
Modification 2,241 - 2,241
Additions 63,490 221 63,711
Disposals (10,527) - (10,527)
Charge during the financial year (51,913) (368) (52,281)
Exchange fluctuation 516 1 517
As at 30 June 214,131 224 214,355
Properties Total
The Company RM’000 RM’000
2023
As at 1 July 4,075 4,075
Charge during the financial year (940) (940)
As at 30 June 3,135 3,135
2022
As at 1 July 5,015 5,015
Charge during the financial year (940) (940)
As at 30 June 4,075 4,075
200 • FINANCIALS

15 INVESTMENT PROPERTIES
The Group
2023 2022
RM’000 RM’000
Fair value
As at 1 July 471,610 469,610
Fair value gain 20 2,000
As at 30 June 471,630 471,610
The analysis of investment properties is as follows:

Freehold land and building 469,000 469,000
Leasehold land and building 2,630 2,610
The fair value of the properties was estimated based on open market valuation by an independent professional valuer, Raine &
Horne International Zaki + Partners Sdn Bhd. During the financial year, the fair value gain attributable to insurance fund policy
holders was RM20,000.
Pursuant to MFRS 13 “Fair Value Measurement”, the Group establishes a fair value hierarchy that categories into three levels of
inputs to valuation techniques used to measure fair value.
The Group
2023 2022
RM’000 RM’000
Level 2 2,630 2,610

Level 3 469,000 469,000
Description of valuation techniques used and key inputs to valuation on investment properties measured at Level 3:
The Group
Valuation technique Unobservable input 2023 2022
Comparison and investment method Term yield 6.00% 6.00%

Revisionary rate 6.50% - 6.70% 6.50% - 6.75%
Discount rate 6.50% - 6.70% 6.50% - 6.75%
Average rental per square feet (net) RM2.07-RM3.84 RM2.11 - RM3.87
Estimated value per square feet RM521-RM799 RM521 - RM799
The investment properties generated rental income and incurred the following direct expenses:
The Group
2023 2022
RM’000 RM’000
Rental income 7,193 8,789

Direct operating expenses 9,862 8,462

16 GOODWILL ARISING ON CONSOLIDATION
The Group
2023 2022
RM’000 RM’000
As at 1 July/30 June 2,410,644 2,410,644
Goodwill has been allocated to the following cash-generating units ("CGUs"):

Commercial banking 2,246,484 2,246,484
Investment banking and asset management 99,803 99,803
Insurance 64,357 64,357
2,410,644 2,410,644
Impairment test for goodwill
(i) Commercial banking CGU and investment banking and asset management CGU
The recoverable amounts of the commercial banking CGU and investment banking and asset management CGU have
been determined based on the respective value-in-use calculations. Value in use is the present value of the future cash
flows expected to be derived from the CGU. This calculation uses pre-tax cash flow projection based on the budget for the
financial year ending 2024, which is approved by the respective Board of Directors of Hong Leong Bank Berhad and Hong
Leong Capital Berhad with a further projection of 2 years. Cash flows beyond the 3 years period are extrapolated using
an estimated growth rate of 4.2% (2022: 4.4%) representing the forecasted GDP growth rate of the country for all cash
generating units. The cash flow projections are derived based on a number of key factors including past performance of
these CGUs and management’s expectation of market developments.
In addition, the recoverable amount is assessed by incorporating multiple scenarios with variation in the assumptions
used including discount rate and haircut on the cash flow projections, to allow assessment on the sensitivity of goodwill
recoverable amount taking into consideration assumed probabilities of different future events and/or scenarios.
The discount rate used in determining the recoverable amount of the commercial banking CGUs and investment banking
and asset management CGUs are 12.1% (2022: 9.9%) and 8.7% (2022: 11.2%) respectively. The pre-tax discount rate
reflects the specific risks relating to the CGUs.
202 • FINANCIALS

16 GOODWILL ARISING ON CONSOLIDATION (continued)
Impairment test for goodwill (continued)
(ii) Insurance CGU
The value-in-use of the Insurance CGU is derived using the actuarial valuation for the life insurance business. The actuarial
valuation of the life insurance fund is based on the latest position as at statements of financial position date, using the
most recent available assumptions at the point of assessment. Such assumptions are derived from historical experience of
the insurer and current industry trends and positions.
The value-in-use has been calculated based on the set of assumptions outlined below:
(a) The present value of future shareholders’ earnings is discounted at 8.5% (2022: 8.5%).
(b) Future earnings are projected based on actuarial assumptions that are determined in accordance with generally
accepted actuarial best practice and are appropriate to the business and risk profile of the business.
(c) Allowance for corporate tax of 18% (2022: 18%) has been made on the assumptions that the application of current
tax legislation and tax rates will continue unchanged.
(d) The current actuarial reserving methods and bases have been assumed to continue with no significant alterations.
(e) The current risk-based capital requirement has been assumed to continue unaltered.
(f) Required capital is calculated at the Individual Target Capital Level.
(g) The cost of capital is the cost of holding the required capital at the Individual Target Capital Level allowing for future
investment return on the capital held.
It should be recognised that the actual future results will differ from those stated above, from any future changes in the
operations and economic environment and natural variation in experience. There is no warranty that the future experience will
be in line with the assumptions made.
Management believes that any reasonably possible change to the key assumptions applied would not cause the carrying
amount of the goodwill to exceed the recoverable amount of the CGUs, which could warrant any impairment to be recognised.

17 INTANGIBLE ASSETS
Computer
software Total
The Group Note RM’000 RM’000
2023
Cost or valuation
As at 1 July 1,028,428 1,028,428
Additions 41,863 41,863
Reclassification from property and equipment 13 86,411 86,411
Disposals/write-off (57,397) (57,397)
Exchange fluctuation 12,590 12,590
As at 30 June 1,111,895 1,111,895
Accumulated amortisation and impairment

As at 1 July 703,490 703,490
Amortisation during the financial year 67,129 67,129
Reclassification from property and equipment 13 (65) (65)
As at 30 June 723,977 723,977
Net book value as at 30 June 2023 387,918 387,918
2022
Cost or valuation
As at 1 July 911,492 911,492
Additions 41,382 41,382
Reclassification from property and equipment 13 84,510 84,510
As at 30 June 1,028,428 1,028,428
Accumulated amortisation and impairment

As at 1 July 651,498 651,498
Amortisation during the financial year 62,123 62,123
As at 30 June 703,490 703,490
Net book value as at 30 June 2022 324,938 324,938

204 • FINANCIALS

17 INTANGIBLE ASSETS (continued)
Computer software
2023 2022
The Company RM’000 RM’000
Cost
As at 1 July 441 466
Additions 136 8
Disposals/write-off - (33)
As at 30 June 577 441
Accumulated amortisation
As at 1 July 365 359
Amortisation during the financial year 75 39
Disposals/write-off - (33)
As at 30 June 440 365
Net book value as at 30 June 137 76
18 DEPOSITS FROM CUSTOMERS
The Group
2023 2022
RM’000 RM’000
At amortised cost
Fixed deposits 112,597,523 94,334,763
Negotiable instruments of deposits 10,914,720 8,626,532
Short-term placements 19,048,027 25,984,088
142,560,270 128,945,383
Demand deposits 42,465,293 41,151,127
Savings deposits 22,479,001 24,771,649
Others 398,549 449,369
207,903,113 195,317,528
At fair value through profit or loss

Structured deposits linked to interest rate derivatives 3,874,742 2,425,376
Fair value changes arising from designation at fair value through profit or loss* (310,412) (359,983)
3,564,330 2,065,393
211,467,443 197,382,921
* The Group has issued structured deposits which are linked to interest rate derivatives and designated them at fair value
through profit or loss. This designation is permitted under MFRS 9 as it significantly reduces accounting mismatch. These
instruments are managed by the Group on the basis of fair value and includes terms that have substantive derivative
characteristics.
The fair value changes of the structured deposits which are linked to interest rate derivatives that are attributable to the
changes in own credit risk are not significant.

18 DEPOSITS FROM CUSTOMERS (continued)
(a) The maturity structure of fixed deposits, negotiable instruments of deposits and short-term placements are as follows:
The Group
2023 2022
RM’000 RM’000
Due within:
- six months 119,473,207 104,131,355
- six months to one year 20,115,668 20,172,188
- one year to five years 2,196,854 3,835,461
- more than five years 774,541 806,379
142,560,270 128,945,383
(b) The deposits are sourced from the following customers:
The Group
2023 2022
RM’000 RM’000
Government and statutory bodies 5,261,598 3,703,073

Business enterprises 99,334,076 91,954,329
Individuals 104,628,726 99,418,027
Others 2,243,043 2,307,492
211,467,443 197,382,921
19 INVESTMENT ACCOUNTS OF CUSTOMERS
The Group
2023 2022
RM’000 RM’000
Unrestricted investment accounts:

Mudarabah with maturity 2,249,231 2,659,311
Restricted investment accounts:

Wakalah bi Al-Istihmar 1,282 9,097
2,250,513 2,668,408
206 • FINANCIALS

19 INVESTMENT ACCOUNTS OF CUSTOMERS (continued)
(i) Movement in the investment account holder
Unrestricted Restricted
investment investment
accounts accounts
Mudarabah Wakalah
2023
At 1 July 2,659,311 9,097
Funding inflows/(outflows)
New placement/Renewal during the year 11,645,422 1,316
Redemption during the year (12,068,129) (9,097)
2,236,604 1,316
Profit payable to Investment Account Holder 12,627 (34)
At 30 June 2,249,231 1,282
2022
At 1 July 1,145,154 -
Funding inflows/(outflows)
New placement/Renewal during the year 5,730,758 10,262
Redemption during the year (4,226,969) (236)
2,648,943 10,026
Profit payable to Investment Account Holder 10,368 (929)
At 30 June 2,659,311 9,097

19 INVESTMENT ACCOUNTS OF CUSTOMERS (continued)
(i) Movement in the investment account holder (continued)
Unrestricted Restricted
investment investment
accounts accounts
Mudarabah Wakalah
2023
Investment Asset
House financing 580,926 -
Term financing 1,115,411 -
Personal financing 268,392 -
Cash or cash equivalent 271,875 -
Unit trusts - 1,316
Total investment 2,236,604 1,316
2022
Investment Asset
House financing 688,725 -
Term financing 1,323,448 -
Personal financing 317,873 -
Cash or cash equivalent 318,897 -
Unit trusts - 10,026
Total investment 2,648,943 10,026
(ii) Profit Sharing Ratio (“PSR”) and Rate of Return (“ROR”):
2023 2022
Average Average Average Average
PSR ROR PSR ROR
The Group % % % %
Unrestricted investment accounts:

1 Month 85 2.88 85 2.16
2 Months 85 3.04 85 2.19
3 Months 85 3.64 85 2.18
4 Months 85 3.18 85 2.20
6 Months 84 3.88 83 2.35
12 Months 82 3.27 84 2.56
208 • FINANCIALS

20 DEPOSITS AND PLACEMENTS OF BANKS AND OTHER FINANCIAL INSTITUTIONS
The Group
2023 2022
RM’000 RM’000
Licensed banks 8,316,003 5,007,600

Licensed investment banks 362,886 22,067
Central banks (Note) 1,497,021 1,579,601
Other financial institutions 2,276,150 1,620,217
12,452,060 8,229,485
Note:
Deposits and placements from central banks includes monies received by the Group under the various government financing
scheme as part of the government support measure in response to COVID-19 pandemic for the purpose of SME lending amounting
to RM1,497,021,000 (2022: RM1,579,601,000) at concession rates.
21 DERIVATIVE FINANCIAL INSTRUMENTS
The Group
2023 2022
Derivatives at fair value through profit or loss

- Interest rate swaps 739,030 729,883
- Cross currency swaps 217,004 211,722
- Foreign currency forwards 994,436 732,105
- Foreign currency options 46,942 52,967
- Foreign currency swaps 43,599 5,249
- Futures 26,173 10,145
- Equity options 64,016 104,852
- Commodity swap 1,142 4,348
- Total return swap 92,605 39,156
Derivatives designated as fair value hedge
- Interest rate swaps (b) 10,513 11,266
- Foreign currency forwards 154 476
Total derivative financial instruments assets 2,235,614 1,902,169

21 DERIVATIVE FINANCIAL INSTRUMENTS (continued)
The Group
2023 2022
Derivatives at fair value through profit or loss

- Interest rate swaps (923,202) (1,051,116)
- Cross currency swaps (415,845) (224,152)
- Foreign currency forwards (853,076) (240,959)
- Foreign currency options (33,915) (50,603)
- Foreign currency swaps (40,059) (8,601)
- Equity options (61,479) (103,510)
- Futures (874) (32,739)
- Swaption (19,739) (7,767)
- Commodity swap (1,131) (4,346)
- Total return swap (92,605) (39,156)
Derivatives designated as cash flow hedge
- Interest rate swaps (a) - (361)
Derivatives designated as fair value hedge
- Interest rate swaps (b) (35) (233)
- Foreign currency forwards (5,471) (1,463)
Total derivative financial instruments liabilities (2,447,431) (1,765,006)
(a) Cash flow hedge
The Group’s cash flow hedges principally consist of interest rate swaps that are used to protect against exposures to
variability in future interest cash flows on interest incurring liabilities. The amount and timing of the interest cash flows,
are projected on the basis of their contractual terms and other relevant factors, including estimates of renewal of interest
incurring liabilities. The aggregate projected interest cash flows over time form the basis for identifying gains and losses
on the effective portions of derivatives designated as cash flow hedges to forecast transactions. Gains and losses are
initially recognised directly in equity, in the cash flow hedge reserve, and are transferred to profit or loss when the forecast
cash flows affect the profit or loss.
The effectiveness of hedging relationship is assessed by comparing the changes in fair value of the interest rate swaps
with changes in the fair value of the hedged items attributable to the hedged risk to ensure there is an economic
relationship between the hedged items and the hedging instruments. During the financial year ended 30 June 2023, all
cash flow hedges have been unwind and the cumulative loss in equity has been reclassified to the statements of income
following the maturity of the cash flow hedge.
210 • FINANCIALS

21 DERIVATIVE FINANCIAL INSTRUMENTS (continued)
(a) Cash flow hedge (continued)
The cash flows of the hedging instruments and the hedged items are detailed below:
The Group
2023 2022
>1-3 >1-3
months months
RM’000 RM’000
Cash inflows (hedging instruments) - 569

Cash outflows (hedged items) - (491)
Net cash inflows - 78
(b) Fair value hedge
The Group’s fair value hedges principally consist of interest rate swaps and foreign currency forwards that are used to
protect against changes in the fair value of financial assets due to movement in interest rates and foreign exchange rates.
The Group had undertaken fair value hedges on interest rate risk of RM541,667,000 (2022: RM633,095,000) and foreign
currency risk of RM559,545,000 (2022: RM608,546,000) on certain receivables using interest rate swaps and foreign
currency forwards. The total fair value gain and loss of the said interest rate swaps amounted to gain of RM10,478,000
(2022: gain RM9,515,000) and of the said foreign currency forwards amounted to loss of RM5,317,000 (2022: loss
RM987,000).
On 29 April 2022, HLB issued a nominal value of RM900.0 million Basel III-compliant Additional Tier 1 Green capital
securities (“Green Capital Securities”), pursuant to its Multi-currency Additional Tier 1 capital securities programme. HLB
has hedged the interest rate risk arising from these Green Capital Securities.
Included in the net non-interest income is the net gains and losses arising from fair value hedges that were effective
during the financial year as follows:
The Group
2023 2022
RM’000 RM’000
Gain on hedging instruments 10,169 25,454

Loss on the hedged items attributable to the hedged risks (9,000) (28,656)
1,169 (3,202)

22 OTHER LIABILITIES

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Trade payables 4,435,135 4,149,662 - -

Post employment benefits obligation
- defined contribution plan 1,928 1,905 41 41
Loan advance payment 3,666,443 3,829,956 - -
Treasury and cheque clearing 204,026 128,773 - -
Cash collateral pledged for derivative transactions 298,332 213,260 - -
Sundry creditors and accruals 477,975 402,365 2,847 2,411
Amount due to subsidiary companies - - 6 -
Provision for reinstatement cost 22,136 22,948 278 264
Provision for bonus and staff related expenses 233,053 244,062 11,603 12,152
Expected credit losses on financial guarantee
contracts (a) 8,110 3,657 - -
Financial liabilities due to third party investors (b) 1,242,934 1,589,696 - -
Settlement accounts 889,467 824,436 - -
Others 574,917 590,294 - -
12,054,456 12,001,014 14,775 14,868
(a) Movements in expected credit losses of financial guarantee contracts are as follows:

2023
As at 1 July 3,116 541 - 3,657
Changes in ECL due to transfer within stages (4) 4 - -
- Transfer to Stage 1 41 (41) - -
- Transfer to Stage 2 (45) 45 - -
New financial assets originated 8,386 - - 8,386
Changes due to change in credit risk (4,839) 833 - (4,006)
Exchange differences 555 14 - 569
As at 30 June 6,718 1,392 - 8,110
212 • FINANCIALS

22 OTHER LIABILITIES (continued)
(a) Movements in expected credit losses of financial guarantee contracts are as follows: (continued)

2022
As at 1 July 3,378 1,185 - 4,563
Changes in ECL due to transfer within stages 15 (199) 184 -
- Transfer to Stage 1 70 (70) - -
- Transfer to Stage 2 (55) 55 - -
- Transfer to Stage 3 - (184) 184 -
New financial assets originated 170 - - 170
Financial assets derecognised (1,143) (4) - (1,147)
Changes due to change in credit risk 647 (425) (184) 38
Changes in models/risk parameters (92) (38) - (130)
Exchange differences 141 22 - 163
As at 30 June 3,116 541 - 3,657
(b) Financial liabilities due to third party investors relate to the net asset value of units held by the third party investors of unit
trust funds deemed as subsidiary company pursuant to MFRS 10 “Consolidated Financial Statements”.
23 LEASE LIABILITIES

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Lease liabilities 192,011 212,599 3,353 4,249
Scheduled repayment of lease liabilities, showing contractual undiscounted cash flows:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Scheduled repayment of lease liabilities

- Not later than one year 44,608 42,560 945 896
- Later than one year and not later than five years 114,697 130,277 2,408 3,353
- Later than five years 32,706 39,762 - -
192,011 212,599 3,353 4,249

24 DEFERRED TAXATION
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set-off current tax assets against current
tax liabilities and when the deferred taxes relate to the same tax authority. The following amounts, determined after appropriate
offsetting, are shown in the statements of financial position:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Deferred tax assets/(liabilities)

- to be recovered within 12 months 415,090 456,845 203 229
- to be recovered more than 12 months (307,216) (91,914) - -
107,874 364,931 203 229
The analysis of deferred tax assets and deferred tax liabilities is as follows:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Deferred tax assets

- Cash flow hedge reserve - 88 - -
- Financial assets at FVTPL - 68,954 - -
- Financial investments at FVOCI 149,282 241,482 - -
- Unutilised tax credit 89,604 98,747 - -
- Provision for expenses 110,767 123,238 - -
- Expected credit loss 238,120 248,339 - -
- Other temporary differences 807 4,771 203 229
588,580 785,619 203 229
Deferred tax liabilities

- Property and equipment (83,360) (74,373) - -
- Financial assets at FVTPL (12,336) - - -
- Unallocated surplus (385,010) (346,315) - -
(480,706) (420,688) - -
Net deferred tax assets 107,874 364,931 203 229
214 • FINANCIALS

24 DEFERRED TAXATION (continued)
The movements in deferred tax assets and liabilities during the financial year are as follows:
Property Financial Financial Cash flow Expected Provision Other

and investments assets hedge Unutilised credit for Unallocated temporary
equipment at FVOCI at FVTPL reserve tax credit losses expenses surplus differences Total
The Group Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
2023
As at 1 July (74,373) 241,482 68,954 88 98,747 248,339 123,238 (346,315) 4,771 364,931
Charged to statements of income 42 (8,214) - (13,504) - (9,142) (10,358) (11,975) (38,695) (1,070) (92,958)
Charged to insurance funds - - (67,786) - - - - - (2,900) (70,686)
Charged to equity 57 - (93,068) - (83) - - - - - (93,151)
Exchange difference and others (773) 868 - (5) - 139 (496) - 5 (262)
As at 30 June (83,360) 149,282 (12,336) - 89,605 238,120 110,767 (385,010) 4,770 107,874
2022
As at 1 July (66,988) (19,568) (80,500) 1,904 111,008 249,748 120,143 (297,387) 893 19,253
(Charged)/credited to statements of income 42 (7,172) - 18,057 - (12,270) (1,518) 2,970 (48,927) 2,136 (46,724)
(Charged)/credited to insurance funds (9) - 131,397 - - - - - 1,743 133,131
Credited/(charged) to equity 57 - 261,084 - (1,816) - - - - - 259,268
Exchange difference and others (204) (34) - - 9 109 125 (1) (1) 3
As at 30 June (74,373) 241,482 68,954 88 98,747 248,339 123,238 (346,315) 4,771 364,931

24 DEFERRED TAXATION (continued)
The movements in deferred tax assets and liabilities during the financial year are as follows: (continued)
Other
temporary
differences
The Company Note RM’000
2023
As at 1 July 229
Charged to statements of income 42 (26)
As at 30 June 203
2022
As at 1 July 184
Credited to statements of income 42 45
As at 30 June 229
25 BORROWINGS

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Revolving credit (a) - 100,075 - 100,075

Commercial papers (b) - 109,920 - 109,920
Senior notes (c) 201,936 201,936 201,919 201,863
201,936 411,931 201,919 411,858
(a) The revolving credit facilities are unsecured and repayable within 12 months.
(b) The CPs are issued at a discount and the issue price is calculated in accordance with the Rules on Fully Automated System
for Issuing/Tendering (“FAST”) issued by Bank Negara Malaysia at the tenure of one (1), three (3), six (6), nine (9) or
twelve (12) months as the Company may select.
(c) On 23 August 2021, the Company issued an unsecured RM200.0 million in aggregate principal amount of new Senior Notes
(“the new Notes”) out of its multi-currency perpetual notes programme. The new Notes were issued for a period of 3 years
with a coupon rate of 2.85% per annum.
216 • FINANCIALS

26 SUBORDINATED OBLIGATIONS

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Tier 2 subordinated debt, at par (a) 600,000 600,000 - -

Add: Interest payable 4,710 4,710 - -
604,710 604,710 - -
Tier 2 subordinated notes, at par (b) 1,600,000 1,600,000 1,100,000 1,600,000

Add: Interest payable 2,867 2,473 2,203 2,473
1,602,867 1,602,473 1,102,203 1,602,473
Less: Unamortised discounts (927) (100) (344) (849)
1,601,940 1,602,373 1,101,859 1,601,624
2,206,650 2,207,083 1,101,859 1,601,624
(a) On 3 February 2020, Hong Leong Assurance Berhad (“HLA”), a wholly owned subsidiary of HLA Holdings Sdn Bhd and also
an indirect subsidiary of HLFG, completed the Subordinated Notes (“Sub-Notes”) issuance of RM300.0 million in nominal
value. The Sub-Notes were issued for a period of 10 years on a 10 non-callable 5 years basis with a coupon rate of 3.85%
per annum.
On 28 December 2020, HLA completed two issuances of Sub-Notes for RM150.0 million in nominal value each. The Sub-
Notes were issued for a period of 5 years basis with a coupon rate of 3.45% per annum and 8 years basis with a coupon
rate of 3.70% respectively.
The above Sub-Notes are unsecured liabilities and classified as Tier 2 capital under Risk-Based Capital Framework for
Insurers.
(b) On 25 June 2018, the Company issued an unsecured RM500.0 million nominal value of Tier 2 subordinated notes (“Sub-
Notes”) out of its multi-currency perpetual notes programme. The Sub-Notes, which qualified as Tier 2 capital for the
Company, carry a distribution rate of 4.93% per annum. The Sub-Notes has a tenure of 10 years non-callable 5 years. The
proceeds from the issuance of Sub-Notes were used to subscribe for RM500.0 million Tier 2 subordinated notes issued by
HLB, a subsidiary of the Company. On 26 June 2023, the Company had fully redeemed the RM500.0 million nominal value
of this Sub-Notes.
On 14 June 2019, the Company had issued an unsecured RM1.1 billion nominal value of Tier 2 subordinated notes (“Sub-
Notes”) out of its multi-currency perpetual notes programme. The Sub-Notes, which qualified as Tier 2 capital for the
Company, carry a distribution rate of 4.30% per annum. The Sub-Notes has a tenure of 10 years non-callable 5 years. The
proceeds from the issuance of Sub-Notes were used to subscribe for RM1.0 billion and RM100.0 million Tier 2 subordinated
notes issued by HLB and HLIB respectively, the subsidiary companies of the Company.
On 19 June 2023, HLB issued an unsecured RM500.0 million nominal value of Tier 2 subordinated notes (“Sub-Notes”) out
of its multi-currency subordinated notes programme. The Sub-Notes carry a distribution rate of 4.20% per annum with a
tenure of 10 years non-callable 5 years.

27 MULTI-CURRENCY ADDITIONAL TIER 1 CAPITAL SECURITIES

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Multi-currency Additional Tier 1 capital securities, at par 1,700,000 1,700,000 400,000 800,000
Add: Interest payable 16,005 13,712 4,965 6,799
1,716,005 1,713,712 404,965 806,799
Less: Unamortised discounts (1,490) (1,145) (114) (368)
Add: Fair value changes arising from fair value hedges 5,115 3,282 - -
1,719,630 1,715,849 404,851 806,431
On 30 November 2017, the Company issued an unsecured RM400.0 million nominal value of Multi-currency Additional Tier 1
capital securities (“Capital Securities”) out of its multi-currency perpetual notes programme. The Capital Securities, which qualify
as Additional Tier 1 capital for the Company, carry a distribution rate of 5.23% per annum. The Capital Securities are perpetual
with an Issuer’s call option to redeem at the end of year 5. The proceeds from the issuance was used to subscribe for RM400.0
million Additional Tier 1 capital securities issued by HLB, a subsidiary of the Company. On 30 November 2022, the Company had
fully redeemed the RM400.0 million nominal value of this Capital Securities.
On 29 March 2019, the Company issued a second tranche of unsecured RM400.0 million nominal value Capital Securities. The
Capital Securities carry a distribution rate of 4.82% per annum, perpetual with an Issuer’s call option to redeem at the end of
year 5. The proceeds from the issuance was used to subscribe for RM400.0 million Additional Tier 1 capital securities issued by
HLB.
On 29 April 2022, HLB issued a nominal value of RM900.0 million Basel III-compliant Additional Tier 1 Green capital securities
(“Green Capital Securities”), out of its multi-currency Additional Tier 1 capital securities programme. The Green Capital Securities
carry a distribution rate of 4.45% per annum and are perpetual and non-callable for 5 years with an Issuer’s call option to
redeem at the end of year 5. Proceeds from the issuance of the Green Capital Securities shall be utilised for purposes that meet
the criteria as set out in the HLB Green Bond Framework, which was established by HLB on 20 February 2022 and revised in April
2022 (as may be amended, revised and/or substituted from time to time) in accordance with the ASEAN Green Bond Standards
issued by the ASEAN Capital Markets Forum in November 2017 and revised in October 2018 and the Green Bond Principles issued
by the International Capital Market Association in June 2021.
On 14 October 2022, HLB issued a nominal value of RM400.0 million Additional Tier 1 capital securities (“Capital Securities”) out
of its multi-currency Additional Tier 1 capital securities programme. The Capital Securities carry a distribution rate of 4.70% per
annum are perpetual and non-callable for 5 years with an Issuer’s call option to redeem at the end of year 5.
218 • FINANCIALS

28 INSURANCE FUNDS
The Group
2023 2022
RM’000 RM’000
Unearned premium reserves 160,334 119,375

Life policyholders’ fund 13,343,352 12,528,235
Life investment-linked unitholders’ fund 5,939,225 4,876,579
19,442,911 17,524,189
The main insurance risks that the Group is exposed to are the following:
• Mortality risk – risk of loss arising due to policyholder’s death experience being different than expected.
• Morbidity risk – risk of loss arising due to policyholder’s health experience being different than expected.
• Longevity risk – risk of loss arising due to the annuitants living longer than expected.
• Investment return/interest rate risk – risk of loss arising from actual returns being different than expected.
• Expense risk – risk of loss arising from expense experience being different than expected.
• Lapse risk – risk of loss arising due to policyholder surrender experience being different than expected.
The risks vary in relation to the location of the risk insured by the Group, type of risk insured or by industry.
29 SHARE CAPITAL
The Group and the Company

2023 2022
Number of Number of
ordinary ordinary
shares shares
‘000 RM’000 ‘000 RM’000
Issued and fully paid capital

Ordinary shares with no par value 1,147,517 2,267,008 1,147,517 2,267,008

30 RESERVES

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Retained profits (a) 22,843,179 20,937,790 14,627,185 14,315,649

Regulatory reserves (b) 1,016,490 666,534 - -
Share options reserve (c) 35,502 60,866 2,296 2,685
Exchange fluctuation reserve (d) 967,332 907,614 - -
Other capital reserve (e) 213,314 213,314 254,991 254,991
Fair value reserve (f) (318,005) (541,311) - -
Cash flow hedge reserve (g) - (185) - -
24,757,812 22,244,622 14,884,472 14,573,325
(a) The Company can distribute dividends out of its entire retained earnings under the single-tier system.
(b) Regulatory reserves represent the Group’s compliance with BNM’s Revised Policy Documents on Financial Reporting and
Financial Reporting for Islamic Banking Institutions with effect from 1 July 2018, whereby the domestic banking subsidiaries
must maintain, in aggregate, loss allowance for non-credit impaired exposures and regulatory reserves of no less than 1%
of total credit exposures, net of loss allowance for credit-impaired exposures.
Prior to 1 July 2018, the Group comply with BNM’s Policy on Classification and Impairment Provisions for Loans/Financing,
to maintain, in aggregate, the collective impairment allowances and regulatory reserves of no less than 1.2% of total
outstanding loans/financing, net of individual impairment allowances.
During the financial year, an amount of RM350.0 million at Group has been transferred from regulatory reserves to
retained profits (2022: RM229.4 million).
Included in the Group is the regulatory reserve maintained by the Group’s banking subsidiary company in Vietnam of
RM11.2 million (2022: RM11.2 million) in line with the requirements of the State Bank of Vietnam.
(c) The share options reserve arose from the employee share option schemes granted to eligible executives of the Group.
Terms of the share options and movements in the number of shares held by Trustee for ESS are disclosed in Note 54 to the
financial statements.
(d) Exchange differences arising from translation of the Group’s banking foreign branches, subsidiaries and associated
companies are shown under exchange fluctuation reserve.
(e) The other capital reserve of the Group arose from the capitalisation of bonus issue, gain on disposal of subsidiary company
and assets in certain subsidiary companies, other capital reserve arising from redemption of redeemable preference
shares “RPS” from the subsidiaries and revaluation gain arising from change in use from owner-occupied properties to
investment properties. The capital reserve of the Company arose from gain on disposal of a subsidiary company not
recognised in the statements of income due to a common control transaction, and investments and proceeds on issuance
of replacement warrants used for bond redemption in previous years.
220 • FINANCIALS

30 RESERVES (continued)
(f) The fair value reserve is in respect of unrealised fair value gains and losses on financial investments at fair value through
other comprehensive income.
The Group
2023 2022
As at 1 July (541,311) 85,375

Net fair value changes 467,354 (1,110,656)
Changes in expected credit losses 294 (751)
Reclassification to net profits/retained profits on disposal and impairment (26,551) (66,794)
Deferred taxation 57 (93,068) 261,084
Share of fair value reserve of associated companies (11,133) (29,506)
Net change in fair value reserve 336,896 (946,623)
Attributable to non-controlling interests (113,590) 319,937
As at 30 June (318,005) (541,311)
(g) Hedging reserve arises from cash flow hedge activities undertaken by HLB to hedge the changes in the cash flow hedged
items arising from the movement of market interest rates. The reserve is non-distributable and is reversed to the statement
of income when the hedged items affect the statement of income or termination of the cash flow hedge.
31 TREASURY SHARES FOR ESS
A trust has been set up for the ESS and it is administered by an appointed trustee. This trustee will be entitled from time to time
to accept financial assistance from the Company upon such terms and conditions as the Company and the trustee may agree to
purchase the Company’s shares from the open market for the purposes of this trust.
MFRS 132 “Financial Instruments: Presentation” requires that if an entity reacquires its own equity instruments, those instruments
shall be deducted from equity and are not recognised as a financial asset regardless of the reason for which they are reacquired.
In accordance with MFRS 132 “Financial Instruments: Presentation”, the shares purchased for the benefit of the ESS holders are
recorded as “Treasury Shares for ESS” in the equity on the statements of financial position. The number of shares held by the
appointed trustee was 9,323,192 shares (2022: 9,479,596) at an average price of RM18.74 per share (2022: RM18.74). The total
consideration paid, including transaction costs was RM174,725,233 (2022: RM177,656,388).
Pursuant to the insurance subsidiary company’s ESS, the insurance subsidiary company also held 4,091,900 (2022: 4,091,900)
units of the Company’s shares at an average price of RM14.27 (2022: RM14.27) per share with total consideration paid, including
transaction costs of RM58,381,907 (2022: RM58,381,907), which have been classified as treasury shares held for ESS at the
Group level.
The main features of the ESS are disclosed in the Director’s Report and details of the ESS are disclosed in Note 54 to the financial
statements.

32 INTEREST INCOME

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Loans, advances and financing 5,586,379 4,143,728 - -

Money at call and deposit placements with financial
institutions 295,460 147,955 2,858 562
Securities purchased under resale agreements 867 758 - -
Financial investments at FVOCI 919,899 709,818 - -
Financial investments at amortised cost 702,552 653,131 - -
Subordinated obligations - - 70,497 70,830
Multi-currency Additional Tier 1 capital securities - - 27,425 39,400
Others 43,875 17,357 - -
7,549,032 5,672,747 100,780 110,792
Of which:
Accretion of discount less amortisation of premium (7,961) (143,093) - -
Interest income earned on impaired loans, advances and
financing 41,342 26,008 - -
33 INTEREST INCOME FOR FINANCIAL ASSETS AT FVTPL
The Group
2023 2022
RM’000 RM’000
Financial assets at FVTPL 214,224 270,941
34 INTEREST EXPENSE
2023 2022 2023 2022

RM’000 RM’000 RM’000 RM’000
Deposits and placements of banks and other financial

institutions 392,662 84,152 - -
Deposits from customers 2,733,069 1,616,096 - -
Short-term placements 622,833 178,631 - -
Borrowings 8,221 14,269 8,277 14,331
Subordinated obligations 94,788 94,439 72,117 72,468
Recourse obligations on loans sold to Cagamas Berhad 29,263 15,450 - -
Multi-currency Additional Tier 1 capital securities 81,755 47,102 28,247 40,598
Others 14,660 37,045 229 282
3,977,251 2,087,184 108,870 127,679
222 • FINANCIALS

35 INCOME FROM ISLAMIC BANKING BUSINESS
The Group
2023 2022
RM’000 RM’000
Income derived from investment of depositors’ funds and others 1,894,039 1,409,048
Income derived from investment of shareholders’ funds 259,365 168,618
Income derived from investment of investment accounts 118,629 68,451
Income attributable to depositors (1,229,550) (702,907)
Income attributable to depositors on investment accounts (79,115) (38,425)
963,368 904,785
Of which:
Financing income earned on impaired financing and advances 6,556 3,417
36 FINANCIAL EFFECTS OF LOSS FROM THE MODIFICATION OF CASH FLOWS AND BENEFITS RECOGNISED UNDER THE VARIOUS
GOVERNMENT SCHEMES
The Group
2023 2022
RM’000 RM’000
Loss on modification of cash flow

included in interest income (Note 32) - (27,472)
included in income from Islamic banking business (Note 35) - (17,944)
Subtotal - (45,416)
Note:
The Group supported its customers impacted by the COVID-19 pandemic by providing targeted assistance to customers through
various government support measures such as PEMULIH and URUS. As a result, the Group recognised a loss from the modification
of cash flows of the loan/financing.

37 NON-INTEREST INCOME

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Insurance income 310,277 368,913 - -

Brokerage income 44,622 65,883 - -
Fee income
Commissions 158,329 181,402 - -
Service charges and fees 38,491 37,999 - -
Guarantee fees 27,807 15,913 - -
Credit card related fees 210,975 193,684 - -
Corporate advisory fees 5,006 9,970 - -
Commitment fees 37,124 36,696 - -
Fee on loans, advances and financing 51,585 50,101 - -
Placement fees 10,238 8,853 - -
Arranger fees 2,740 1,503 - -
Unit trust fee income 46,106 58,104 - -
Other fee income 228,791 229,441 11,334 8,802
817,192 823,666 11,334 8,802
Net income from securities
Net realised gain/(loss) from sale of:
- financial assets at FVTPL 94,926 (61,771) - (38)
- financial investments at FVOCI 38,769 81,523 - -
- derivative financial instruments (21,620) 56,192 - -
Gross dividend income from:
- financial assets at FVTPL 90,215 73,196 - 193
- financial investments at FVOCI 2,175 406 - -
- subsidiary companies - - 885,303 820,911
Net unrealised gain on revaluation of:
- financial assets at FVTPL 25,935 118,285 - -
- derivative financial instruments 111,593 114,389 - -
Net realised gain/(loss) on fair value changes arising
from fair value hedges 7,371 (8,454) - -
Net unrealised gain/(loss) on fair value changes arising
from fair value hedges 1,169 (3,202) - -
350,533 370,564 885,303 821,066
224 • FINANCIALS

37 NON-INTEREST INCOME (continued)

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Other income
Foreign exchange gain/(loss) 124,638 (158,222) 1 1
Rental income 10,850 10,975 - -
Net gain on disposal of property and equipment 387 1,745 113 160
Other non-operating income 21,298 6,703 224 245
157,173 (138,799) 338 406
1,679,797 1,490,227 896,975 830,274
38 OVERHEAD EXPENSES

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Personnel costs (a) 1,409,181 1,303,424 25,297 113

Establishment costs (b) 579,281 558,715 2,811 2,262
Marketing expenses (c) 232,887 198,548 - -
Administration and general expenses (d) 348,278 297,523 4,201 4,342
2,569,627 2,358,210 32,309 6,717
(a) Personnel costs comprise the following:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Salaries, bonus and allowances 1,322,626 1,234,170 20,727 16,870

Medical expenses 32,767 30,909 16 15
Training and convention expenses 17,235 14,824 51 3
Staff welfare 10,996 13,341 712 636
Other employees benefits 25,557 10,180 3,791 (17,411)
1,409,181 1,303,424 25,297 113

38 OVERHEAD EXPENSES (continued)
(b) Establishment costs comprise the following:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Depreciation of property and equipment 120,327 130,105 1,201 760

Depreciation of right-of-use assets 49,862 50,518 940 940
Amortisation of intangible assets 64,223 59,027 75 39
Rental of premises 1,503 1,854 - -
Information technology expenses 252,771 230,781 235 312
Security services 20,937 19,354 - -
Electricity, water and sewerage 22,524 21,628 38 37
Hire of plant and machinery 13,666 12,483 - -
Others 33,468 32,965 322 174
579,281 558,715 2,811 2,262
(c) Marketing expenses comprise the following:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Advertisement and publicity 34,264 29,454 - -

Sales commission and credit card related fees 146,392 127,692 - -
Others 52,230 41,402 - -
232,886 198,548 - -
(d) Administration and general expenses comprise the following:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Teletransmission expenses 21,946 23,339 23 24

Stationery and printing expenses 11,885 12,251 19 14
Professional fees 106,828 92,911 1,406 1,506
Insurance fees 45,472 33,550 - -
Stamp, postage and courier 14,738 15,229 - -
Credit card fees 75,315 49,302 - -
Travelling and transport expenses 3,753 2,806 4 1
Registration and license fees 11,059 10,151 - -
Brokerage and commission 11,974 11,007 - -
Others 45,309 46,977 2,749 2,797
348,279 297,523 4,201 4,342
226 • FINANCIALS

38 OVERHEAD EXPENSES (continued)
The above expenditure includes the following statutory disclosures:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Directors’ remuneration (Note 41) 12,747 11,853 12,381 11,386

Auditors’ remuneration*:
(i) PwC Malaysia firm
- statutory audit 3,623 3,201 159 146
- regulatory related fees 1,096 471 21 19
- other services 2,933 578 408 329
- tax compliance 88 98 - -
(ii) PwC overseas affiliated firms
- statutory audit 1,052 731 - -
- regulatory related fees 223 194 - -
- tax compliance 101 93 - -
Property and equipment written off 1,182 729 - -
Intangible assets written off 2,607 738 - -
Options (writeback)/charge arising from ESS (10,144) (20,447) 2,481 (18,660)
39 ALLOWANCE FOR IMPAIRMENT LOSSES ON LOANS, ADVANCES AND FINANCING AND OTHER LOSSES
The Group
2023 2022
RM’000 RM’000
Allowance for impairment losses on loans, advances and financing

- expected credit losses 343,086 393,314
Writeback of impairment losses on clients’ and brokers’ balances

- expected credit losses (132) (190)
Impaired loans, advances and financing

- written off 29,519 20,054
- recovered from bad debt written off (257,265) (250,061)
115,208 163,117

40 WRITEBACK OF IMPAIRMENT LOSSES ON OTHER ASSETS
The Group
2023 2022
RM’000 RM’000
Expected credit losses on:

- financial investments at FVOCI 194 (827)
- financial investments at amortised cost (53) (14)
- other receivables (8) 47
- cash and short-term funds (155) 85
- deposits and placements with banksand other financial institutions (282) (322)
(304) (1,031)
The Company
2023 2022
RM’000 RM’000
Expected credit losses on investment in debt instruments issued by

subsidiary companies (1,514) (1,253)
228 • FINANCIALS

41 DIRECTORS’ REMUNERATION
Forms of remuneration in aggregate for all Directors for the financial year are as follows:

Estimated Estimated
Salaries, monetary Salaries, monetary
allowances value allowances value
and other Director for benefits- and Other Director for benefits-
remunerations fees in-kind Total remunerations fees in-kind Total
2023 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Executive Director
Tan Kong Khoon 11,376 - 28 11,404 11,376 - 28 11,404
Non-executive Directors
Tan Sri Quek Leng Chan - - 35 35 - - 35 35
Leong Ket Ti 47 285 - 332 24 160 - 184
Raja Noorma binti Raja Othman 72 305 - 377 19 140 - 159
Chong Chye Neo 34 205 - 239 34 205 - 239
Ho Heng Chuan 32 180 - 212 32 180 - 212
Emily Kok 18 130 - 148 18 130 - 148
203* 1,105 35 1,343 127* 815 35 977
Total Directors’ remuneration 11,579 1,105 63 12,747 11,503 815 63 12,381
Directors of subsidiaries 12,100 5,181 618 17,899
* Directors’ meeting allowances


41 DIRECTORS’ REMUNERATION (continued)
Forms of remuneration in aggregate for all Directors for the financial year are as follows: (continued)

Estimated Estimated
Salaries, monetary Salaries, monetary
allowances value allowances value
and other Director for benefits- and other Director for benefits-
remunerations fees in-kind Total remunerations fees in-kind Total
Executive Director
Tan Kong Khoon 10,489 - 23 10,512 10,489 - 23 10,512
Non-executive Directors
Tan Sri Quek Leng Chan - - 29 29 - - 29 29
Leong Ket Ti 25 285 - 310 13 160 - 173
Raja Noorma binti Raja Othman 44 302 - 346 12 137 - 149
Chong Chye Neo 34 327 - 361 23 205 - 228
Dato’ Noorazman bin Abd Aziz 7 70 - 77 7 70 - 77
(Resigned with effect from 14 January 2022)
Ho Heng Chuan 18 177 - 195 18 177 - 195
Emily Kok 1 22 - 23 1 22 - 23
(Appointed with effect from 26 April 2022)
129* 1,183 29 1,341 74* 771 29 874
Total Directors’ remuneration 10,618 1,183 52 11,853 10,563 771 52 11,386
Directors of subsidiaries 12,536 4,441 209 17,186
* Directors’ meeting allowances

230 • FINANCIALS

41 DIRECTORS’ REMUNERATION (continued)
Directors and Officers of the Group are covered under the Directors’ & Officers’ Liability Insurance in respect of liabilities arising
from acts committed in their respective capacity as, inter alia, Directors and Officers of the Group subject to the terms of the
policy. The total amount of Directors’ & Officers’ Liability Insurance effected for the Directors & Officers of the Group was RM10
million (2022: RM10 million). The total amount of premium paid for the Directors’ & Officers’ Liability Insurance by the Group
was RM71,250 (2022: RM84,550) and the apportioned amount of the said premium paid by the Company was RM3,563 (2022:
RM4,228).
The movement and details of the Directors of the Company in office and interests in shares and share options are reported in
the Directors’ Report.
The movement and details of the Directors of the Company in office and interests in shares and share options are reported in
the Directors’ Report.
Included in the Non-Executive Directors’ remunerations are amounts paid to Directors in their capacities as Executive Directors
for certain subsidiary companies.
The names of Directors of subsidiaries and their remuneration details are set out in the respective subsidiaries’ statutory accounts
and the said information is deemed incorporated herein by such reference and made a part hereof.
42 TAXATION

2023 2022 2023 2022
Note RM’000 RM’000 RM’000 RM’000
Income tax:
- Current year 842,387 1,139,477 600 418
- Over accrual in prior years (40,584) (29,083) (418) (122)
801,803 1,110,394 182 296
Deferred taxation 24 92,958 46,724 26 (45)

Taxation 894,761 1,157,118 208 251

42 TAXATION (continued)

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Profit before taxation 5,102,380 4,839,979 858,090 807,923
Tax calculated at a rate of 24% (2022: 24%) 1,224,571 1,161,595 205,942 193,902
Additional tax rate of 9% in excess of RM100.0 million (Note) - 309,949 - -
Tax effects of:

- Differences in tax rate of foreign inward and offshore
insurance (747) (278) - -
- Income not subject to tax (55,922) (98,830) (219,030) (223,371)
- Share of net income of associated companies (325,850) (266,102) - -
- Expenses not deductible for tax purposes 96,641 81,602 13,714 29,842
- Over accrual in prior years (40,584) (29,083) (418) (122)
- Recognition of unutilised tax credit previously not
recognised (1,295) (1,332) - -
- Origination of temporary differences not recognised (2,053) (403) - -
Taxation 894,761 1,157,118 208 251
In order to support the Government’s initiative to assist parties affected by the pandemic, it has been proposed in Budget 2022
that for year of assessment (“YA”) 2022, a special one-off tax which is called ‘Cukai Makmur’ will be imposed on non-micro, small
and medium enterprise companies which generate high profits during the period of the pandemic. Chargeable income in excess
of RM100.0 million will be charged an income tax rate of 33% for YA 2022.
Under the Malaysian Finance Act 2021 which was gazetted on 31 December 2021, the Group’s unutilised tax losses can be
utilised up to a maximum of ten consecutive years effective retrospectively from YA 2019.
232 • FINANCIALS

43 EARNINGS PER SHARE
Basic earnings per share
Basic earnings per share are calculated by dividing the net profit attributable to ordinary equity holders of the Company by the
weighted average number of ordinary shares in issue during the financial year.

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Weighted average number of ordinary shares (’000) 1,134,049 1,133,882 1,138,141 1,137,974
Net profit attributable to owners of the parent 2,791,303 2,452,209 857,882 807,672
Basic earnings per share (sen) 246.1 216.3 75.4 71.0
Diluted earnings per share
The Group has no dilution in its earnings per ordinary share in the current and previous financial year as there are no dilutive
potential ordinary shares.
44 DIVIDENDS
Dividends recognised as distribution to ordinary equity holders of the Company:
The Group and The Company

2023 2022
RM’000 RM’000
Interim dividend of 17.0 sen per share in respect of the financial year ended 30 June 2023 193,493 -
Interim dividend of 15.0 sen per share in respect of the financial year ended 30 June 2022 - 170,706
Final dividend of 31.0 sen per share in respect of the financial year ended 30 June 2022 352,792 -
Final dividend of 29.2 sen per share in respect of the financial year ended 30 June 2021 - 332,261
546,285 502,967
The Directors have declared a final single-tier dividend of 32.0 sen per share in respect of the financial year ended 30 June
2023. The financial statements for the current financial year do not reflect this dividend and will be accounted for in equity as
an appropriation of retained profits in the next financial year ending 30 June 2024.

45 COMMITMENTS AND CONTINGENCIES
Group related commitments and contingencies
In the normal course of business, the Group make various commitments and incur certain contingent liabilities with legal recourse
to its customers. No material losses are anticipated as a result of these transactions. These commitments and contingencies are
also not secured over the assets of the Group.
The notional/principal amount of the commitments and contingencies constitute the following:
The Group
2023 2022
RM’000 RM’000
Commitments and contingencies

Direct credit substitutes* 225,515 138,103
Certain transaction related contingent items 2,594,402 2,024,547
Short-term self liquidating trade related contingencies 1,063,924 853,412
Obligations under underwriting agreement - 7,140
Any commitments that are unconditionally cancellable at any time by the Group without
prior notice:
- less than one year 917,463 919,747
Irrevocable commitments to extend credit:
- maturity less than one year 26,457,159 23,913,907
- maturity more than one year 17,073,556 17,538,803
Unutilised credit card lines 6,902,344 7,090,121
55,234,363 52,485,780
Derivative financial instruments

Foreign exchange related contracts^:
- less than one year 67,555,981 58,120,986
- over five years 737,005 396,495
Interest rate related contracts^:
- less than one year 46,129,203 35,859,070
- over five years 4,399,525 4,308,323
Equity related contracts^:
- one year to five years 668,593 102,899
- over five years - 270,542
Credit related contracts^:
- less than one year 121,391 -
- over five years 1,225,853 938,327
Commodity related contracts:
- one year to five years - 493,416
213,774,447 162,207,376
269,008,810 214,693,156
234 • FINANCIALS

45 COMMITMENTS AND CONTINGENCIES (continued)
Group related commitments and contingencies (continued)
* Included in direct credit substitutes are the financial guarantee contracts of RM163,630,721 (2022: RM79,527,616), of
which fair value at the time of issuance is nil.
^ These derivatives are revalued at gross position basis and the fair value have been reflected in Note 21 to the financial
statements as derivative assets or derivative liabilities.
46 CAPITAL COMMITMENTS
The capital commitments are in respect of:

- property and equipment
- intangible assets
Capital expenditure approved by the Directors but not provided for in the financial statements are as follows:
The Group
2023 2022
RM’000 RM’000
Authorised and contracted for 85,460 95,606

Authorised but not contracted for 17,911 21,785
103,371 117,391
47 ULTIMATE HOLDING COMPANY
The ultimate holding company is Hong Leong Company (Malaysia) Berhad, a company incorporated in Malaysia.

48 CAPITAL ADEQUACY
The capital adequacy ratios are computed in accordance with BNM’s Capital Adequacy Framework (Capital Components). The
consolidated capital adequacy of the Group includes consolidation of all financial and non-financial subsidiary companies, except
the insurance/takaful subsidiary companies which shall be deducted in the calculation of Common Equity Tier 1 (“CET 1”) capital.
The total risk-weighted assets (“RWA”) of the Group are computed based on Standardised Approach for Credit Risk and Market
Risk, and Basic Indicator Approach for Operational Risk.
The Capital Adequacy Framework (Capital Components) sets out the minimum capital adequacy ratios as well as requirements
on Capital Conservation Buffer (“CCB”) and Counter Cyclical Buffer (“CCyB”). The minimum capital adequacy requirements for CET
1 capital ratio, Tier 1 capital ratio and Total Capital ratio are 4.500%, 6.000% and 8.000% respectively. The Group is also required
to maintain CCB of up to 2.500% of total RWA, which is phased in starting with 0.625% in year 2016, 1.250% in year 2017,
1.875% in year 2018 and 2.500% in year 2019 onwards. The CCyB which ranges from 0% up to 2.500% is determined as the
weighted average of prevailing CCyB rates applied in the jurisdictions in which the Group has credit exposures. The minimum
capital adequacy including CCB for CET 1 capital ratio, Tier 1 capital ratio and Total capital ratio for year 2019 onwards are 7.000%,
8.500% and 10.500% respectively.
On 19 April 2023, BNM increased the allocation under the BNM’s Fund for SMEs by RM1.3 billion through selected facilities
namely the High Tech and Green Facility (“HTG”), Automation and Digitalisation Facility (“ADF”) and Agrofood Facility (“AF”) to
further support the micro, small and medium enterprises (SMEs). The Group will continue to provide support to SMEs involved
in strategic sectors or critical technology segments through the HTG facility, incentivise the automation of processes and
digitalisation of operations through the ADF facility, and provide financing to increase agrofood production through the AF facility.
(a) The capital adequacy ratios of the Group and banking subsidiaries are as follows:
Hong Leong Financial Hong Leong Bank Hong Leong Bank Hong Leong Investment
Group Group Berhad Bank Berhad
2023 2022 2023 2022 2023 2022 2023 2022
Before deducting
proposed
dividends
CET 1 capital ratio 11.245% 12.025% 13.310% 13.935% 13.000% 13.912% 38.498% 39.445%
Tier 1 capital ratio 12.329% 13.220% 14.353% 15.050% 14.029% 14.999% 38.498% 39.445%
Total capital ratio 14.859% 16.130% 16.399% 17.176% 16.009% 17.051% 48.792% 50.437%
After deducting
proposed
dividends
CET 1 capital ratio 11.022% 11.792% 12.824% 13.428% 12.372% 13.266% 35.719% 35.367%
Tier 1 capital ratio 12.106% 12.987% 13.866% 14.543% 13.401% 14.353% 35.719% 35.367%
Total capital ratio 14.635% 15.897% 15.912% 16.669% 15.381% 16.404% 46.013% 46.359%
236 • FINANCIALS

48 CAPITAL ADEQUACY (continued)
(b) The component of CET 1, Tier 1 and Tier 2 capital under the Capital Components Framework are as follows:
2023 2022 2023 2022 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
CET 1 Capital
Share capital 2,267,008 2,267,008 7,739,063 7,739,063 7,739,063 7,739,063 252,950 252,950
Retained profit 22,843,179 20,937,790 25,017,703 22,727,982 15,727,832 15,120,482 280,317 287,881
Other reserves 909,389 651,730 947,836 592,754 2,905 (283,282) (4,486) (19,792)
Qualifying non-controlling interests 7,906,064 6,896,206 - - - - - -
Less: Treasury shares (233,108) (236,039) (708,766) (713,690) (708,766) (713,690) - -
Less: Other intangible assets (368,261) (309,817) (362,435) (304,749) (326,216) (269,645) - -
Less: Goodwill (2,346,287) (2,346,287) (1,831,312) (1,831,312) (1,771,547) (1,771,547) (33,936) (33,638)
Less: Deferred tax assets (508,213) - (410,436) (528,771) (317,985) (403,666) (96,878) (110,559)
Less: Investment in subsidiary companies/ associated
companies (12,125,553) (9,640,457) (8,712,976) (6,455,474) (3,938,210) (2,794,291) (200) (200)
Total CET 1 Capital 18,344,218 18,220,134 21,678,677 21,225,803 16,407,076 16,623,424 397,767 376,642
Tier 1 Capital
Multi-currency Additional Tier 1 capital securities 399,997 799,932 1,698,491 1,698,839 1,698,491 1,698,839 - -
Tier 1 capital before regulatory adjustments 1,768,001 1,811,347 1,698,491 1,698,839 1,698,491 1,698,839 - -
Less: Investment in Additional Tier 1 perpetual
subordinated sukuk wakalah - - - - (400,000) (400,000) - -
Tier 1 capital after regulatory adjustments 1,768,001 1,811,347 1,698,491 1,698,839 1,298,491 1,298,839 - -
Total Tier 1 Capital 20,112,219 20,031,481 23,377,168 22,924,642 17,705,567 17,922,263 397,767 376,642
Tier 2 Capital
Stage 1 and Stage 2 expected credit loss allowances
and regulatory reserves 1,826,248 1,718,509 1,832,523 1,738,471 1,399,403 1,350,820 6,356 4,952
Subordinated obligations 1,099,990 1,599,900 1,499,089 1,499,970 1,499,089 1,499,970 100,000 100,000
Less: Investment in Tier 2 subordinated sukuk
murabahah - - - - (400,000) (400,000) - -
Total Tier 2 Capital 4,126,703 4,409,048 3,331,612 3,238,441 2,498,492 2,450,790 106,356 104,952
Total capital 24,238,922 24,440,529 26,708,780 26,163,083 20,204,059 20,373,053 504,123 481,594

48 CAPITAL ADEQUACY (continued)
(c) The breakdown of RWA by each major risk category is as follows:
2023 2022 2023 2022 2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Credit risk* 146,099,832 137,480,719 146,601,855 139,077,644 111,952,229 108,065,582 508,514 396,120
Market risk 6,433,925 4,254,505 6,124,089 3,917,894 6,120,834 3,934,497 185,018 217,123
Operational risk 10,596,687 9,789,061 10,143,761 9,327,630 8,131,845 7,485,705 339,681 341,603
Total RWA 163,130,444 151,524,285 162,869,705 152,323,168 126,204,908 119,485,784 1,033,213 954,846
* In accordance with BNM Investment Account Policy, the credit RWA of Hong Leong Islamic Bank Berhad funded by Investment Account of RM1,588,912,000 (2022: RM1,899,820,000) is
excluded from the calculation of capital adequacy ratio of the Group.
(d) The capital adequacy ratios of Hong Leong Bank Group’s subsidiary company are as follows:
Hong Leong Islamic

Bank Berhad
2023 2022
Before deducting proposed dividends

CET 1 capital ratio 11.423% 11.176%
Tier 1 capital ratio 12.653% 12.550%
Total capital ratio 15.051% 15.101%
After deducting proposed dividends

CET 1 capital ratio 11.423% 11.176%
Tier 1 capital ratio 12.653% 12.550%
Total capital ratio 15.051% 15.101%
238 • FINANCIALS

49 SEGMENTAL INFORMATION
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-
maker. The chief operating decision-maker is the person or group that allocates resources to and assesses the performance of
the operating segments of an entity.
Inter-segment pricing is based on internally computed cost of funds.
Segment results, assets and liabilities include items directly attributable to the segment as well as those that can be allocated
on a reasonable basis.
Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are expected to be used
during more than one period.
Business segments
The Group comprises the following main business segments:
Commercial banking - Commercial banking business
Investment banking and asset - Investment banking, futures and stock broking, fund and unit trust management
management
Insurance - Life and general insurance and family takaful business
Other operations - Investment holding and provision of management services


49 SEGMENTAL INFORMATION (continued)
Business segment reporting
Set out below is information of the Group by business segments:
Eliminations/
Commercial Investment Other consolidation
The Group banking banking Insurance operations adjustments Consolidated
2023 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Revenue
External revenue 5,659,889 195,355 582,264 (8,338) - 6,429,170
Inter-segment revenue 25,620 971 1,147 872,376 (900,114) -
Segment revenue 5,685,509 196,326 583,411 864,038 (900,114) 6,429,170
Overhead expenses of which: (2,233,282) (135,097) (210,676) (5,963) 15,391 (2,569,627)
Depreciation of property and
equipment (110,039) (4,532) (4,530) (1,226) - (120,327)
Amortisation of intangible assets (58,132) (2,311) (3,706) (74) - (64,223)
(Allowance for)/writeback of
impairment losses on loans,
advances and financing (115,382) 174 - - - (115,208)
Writeback of/(allowance for)
impairment losses on other
assets 306 25 (27) - - 304
Segment results 3,337,151 61,428 372,708 858,075 (884,723) 3,744,639
Share of results of associated
companies 1,289,480 - 68,261 - - 1,357,741
Profit before taxation 4,626,631 61,428 440,969 858,075 (884,723) 5,102,380
Taxation (894,761)
Net profit for the financial year 4,207,619
Non-controlling interests (1,416,316)
Profit attributable to owners of the
parent 2,791,303
Other information
Segment assets 279,850,454 4,975,761 29,479,529 18,703,533 (17,743,487) 315,265,790
Segment liabilities 245,863,802 4,010,385 25,205,512 1,728,407 (1,171,950) 275,636,156
Other significant segment items

Capital expenditure 169,225 3,665 14,674 1,876 - 189,440
Note:
Total segment revenue comprises of net interest income, income from Islamic banking business and non-interest income.
240 • FINANCIALS

Business segment reporting (continued)
Set out below is information of the Group by business segments: (continued)
Eliminations/
Commercial Investment Other consolidation
The Group banking banking Insurance operations adjustments Consolidated
2022 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Revenue
External revenue 5,575,202 222,478 475,131 (21,295) - 6,251,516
Inter-segment revenue 22,206 882 1,414 816,261 (840,763) -
Segment revenue 5,597,408 223,360 476,545 794,966 (840,763) 6,251,516
Overhead expenses of which: (2,098,376) (126,841) (161,133) 12,946 15,194 (2,358,210)
Depreciation of property and
equipment (121,499) (4,036) (3,785) (785) - (130,105)
Amortisation of intangible assets (53,962) (1,884) (3,143) (38) - (59,027)
(Allowance for)/writeback of
impairment losses on loans,
advances and financing (163,574) 457 - - - (163,117)
Writeback of/(allowance for)
impairment losses on other
assets 851 196 (16) - - 1,031
Segment results 3,336,309 97,172 315,396 807,912 (825,569) 3,731,220
Share of results of associated
companies 1,030,491 - 78,268 - - 1,108,759
Profit before taxation 4,366,800 97,172 393,664 807,912 (825,569) 4,839,979
Taxation (1,157,118)
Net profit for the financial year 3,682,861
Non-controlling interests (1,230,652)
Profit attributable to owners of the
parent 2,452,209
Other information
Segment assets 254,331,377 4,276,873 27,237,632 19,501,749 (18,426,814) 286,920,817
Segment liabilities 223,342,401 3,331,880 23,268,856 2,840,682 (1,852,726) 250,931,093
Other significant segment items

Capital expenditure 151,120 7,220 17,083 2,541 - 177,964
Note:
Total segment revenue comprises of net interest income, income from Islamic banking business and non-interest income.

The Group operates in two main geographical areas:
- Malaysia, the home country of the Group, which includes all the areas of operations in the primary business segments.
- Overseas operations, which includes branch, subsidiary and associate operations in Singapore, Hong Kong, China, Vietnam
and Cambodia. The overseas operations are mainly in commercial banking and insurance business.
Total Total Capital

Revenue assets liabilities expenditure
2023
Malaysia 5,962,870 290,388,064 252,210,810 166,838
Overseas operations 466,300 24,877,726 23,425,346 22,602
6,429,170 315,265,790 275,636,156 189,440
2022
Malaysia 5,825,813 266,930,759 232,285,684 147,712
Overseas operations 425,703 19,990,058 18,645,409 30,252
6,251,516 286,920,817 250,931,093 177,964
242 • FINANCIALS

50 SIGNIFICANT RELATED PARTY TRANSACTIONS
(a) Related parties and relationship
In addition to the related party disclosures mentioned elsewhere in the financial statements, other significant related
parties transactions and their relationship with the Company are as follows:
Related parties Relationship
Hong Leong Company (Malaysia) Berhad (“HLCM”) Ultimate holding company
HLCM Capital Sdn Bhd, HL Management Co Sdn Bhd and Subsidiary companies of ultimate holding company
Hong Leong Share Registration Services Sdn Bhd
Guardian Security Consultants Sdn Bhd (“GSC”) Associated company of ultimate holding company
Hong Leong Industries Berhad and its subsidiary and Subsidiary and associated companies of ultimate
associated companies as disclosed in its financial holding company
statements (“HLI Group”)
Malaysian Pacific Industries Berhad and its subsidiary Subsidiary and associated companies of ultimate
and associated companies as disclosed in its financial holding company
statements (“MPI Group”)
Hume Cement Industries Berhad and its subsidiary and Subsidiary and associated companies of ultimate
associated companies as disclosed in its financial holding company
statements (“Hume Group”)
HLMG Management Co Sdn Bhd Subsidiary companies of ultimate holding company
Guoco Group Limited and its subsidiary and associated Substantial shareholder
companies as disclosed in its financial statements
(“GGL Group”)
GuocoLand (Malaysia) Berhad and its subsidiary and Subsidiary and associated companies of substantial
associated companies as disclosed in its financial shareholder
statements (“GLM Group”)
Subsidiary companies of the Company as disclosed in Note 11 Subsidiary companies of the Company
Key management personnel The key management personnel of the Group and
the Company consists of:
- All Directors of the Company
- Key management personnel of the Company
who are in charge of the HLFG Group
Related parties of key management personnel (i) Close family members and dependents of key
(deemed as related to the Company) management personnel
(ii) Entities that are controlled, jointly controlled or
significant influenced by, or for which significant
voting power in such entity resides with,
directly or indirectly by key management
personnel or its close family members

50 SIGNIFICANT RELATED PARTY TRANSACTIONS (continued)
(b) Related party transactions
Transactions with related parties are as follows:
The Group
Other Key
Parent Associated related management
company companies companies personnel
2023 RM’000 RM’000 RM’000 RM’000
Income
Interest on deposits - 325 - -
Interest on loans - - 3,203 4
Interest on redeemable preference shares - - 2,250 -
Dividend income - - 1,882 -
Rental income - 117 705 -
Brokerage fee received - - 76 23
Insurance premium received - 536 5,761 -
Commission on product - 14,258 82 -
Others - - 564 36
- 15,236 14,523 63
Expenditure
Rental and maintenance - - 11,425 -
Interest on deposits - - - 1,239
Interest paid on short-term placements - - 9,824 4,093
Interest paid on current account and fixed deposits - - 2,578 -
Management fees - - 51,069 -
Insurance expenses - 2,813 4,369 -
Other miscellaneous expenses - 648 10,592 -
- 3,461 89,857 5,332
Amount due from:

Current account - 21,715 - -
Loans - - 35,172 -
Redeemable preference shares - - 25,000 -
Insurance premium receivable - - 570 -
Credit card - - - 334
Others - - 6,929 -
- 21,715 67,671 334
Amount due to:

Current account and fixed deposits - - 18,004 120,160
Short-term placements - - 51,676* 93,429
Others - - 7,075 -
- - 76,755 213,589
* Transaction with subsidiary companies of ultimate holding company

244 • FINANCIALS

(b) Related party transactions (continued)
Transactions with related parties are as follows: (continued)
The Group
Other Key
Parent Associated related management
2022 RM’000 RM’000 RM’000 RM’000
Income
Interest on loans - - 3,446 3
Dividend income - - 2,609 -
Rental income - 117 1,729 -
Brokerage fee received - - 418 46
Insurance premium received - 531 7,364 -
Commission on product - 12,810 - -
Others - - 1,340 315
- 13,787 16,906 364
Expenditure
Rental and maintenance - - 9,533 -
Interest on deposits - - - 14
Interest paid on short-term placements - - 3,657 2,340
Interest paid on current account and fixed deposits - - 1 -
Insurance expenses - 2,171 4,047 -
Other miscellaneous expenses - 984 9,215 -
- 3,155 76,788 2,354
Amount due from:

Current account - 21,809 - -
Loans - - 87,745 -
Redeemable preference shares - - 25,000 -
Insurance premium receivable - - 5,765 -
Credit card - - - 126
Others - - 8,498 -
- 21,809 127,008 126
Amount due to:

Current account and fixed deposits - - 6,032 9,245
Short-term placements - - 199,008* 148,466
Others - - 25,263 -
- - 230,303 157,711
* Transaction with subsidiary companies of ultimate holding company


The Company
Other Key
Parent Subsidiary related management
2023 RM’000 RM’000 RM’000 RM’000
Income
Dividend income - 885,303 - -
Interest on deposits - 1,042 - -
Lease income - sublease - 203 - -
Interest on debt instruments - 97,922 - -
Management fees - 11,334 - -
Other Income - 20 - -
- 995,824 - -
Expenditure
Insurance - 106 149 -
Interest on lease liabilities - 199 - -
Other miscellaneous expenses - 717 305 -
- 1,022 2,584 -
Amount due from:

Money at call and deposit placements - 94,743 - -
Amount due to:

Lease liabilities - 3,353 - -
246 • FINANCIALS

The Company
Other Key
Parent Subsidiary related management
2022 RM’000 RM’000 RM’000 RM’000
Income
Dividend income - 820,911 - -
Lease income - sublease - 203 - -
Interest on debt instruments - 110,230 - -
Management fees - 8,802 - -
Other Income - 197 - -
- 940,430 - -
Expenditure
Insurance - 88 31 -
Interest on lease liabilities - 245 - -
Other miscellaneous expenses - 672 468 -
- 1,005 2,629 -
Amount due from:

Money at call and deposit placements - 17,391 - -
Amount due to:

Lease liabilities - 4,249 - -
The related party transactions of the Company are primarily transacted with related parties domiciled in Malaysia.
The Group
2023 2022
RM’000 RM’000
The approved limit on loans, advances and financing for key management personnel 2,702 2,402

(c) Key management personnel
Key management compensation

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Salaries, other short-term employee benefits and

director fees 14,124 13,239 13,758 12,773
Executive share schemes expenses 2,481 (18,660) 2,481 (18,660)
Included in the above is the Directors’ compensation which is disclosed in Note 41.
Loans made to key management personnel of the Group is on similar terms and conditions generally available to other
employees within the Group. No specific allowances were required for loans made to key management personnel.
51 FINANCIAL INSTRUMENTS
(a) Financial risk management objectives and policies
The Group’s financial risk management policies are adopted from its main operating subsidiary companies which are
involved in banking and finance, securities and insurance related business.
The Board of Directors (“The Board”) of each main operating subsidiary company has the overall responsibility to ensure
there is proper oversight of the management of risks in each of the subsidiary company. The Board sets the risk appetite
and tolerance level that are consistent with each subsidiary company’s overall business objectives and desired risk profile.
A number of committees and dedicated risk management functions have been established to address and manage
specific areas of risk and implement various risk management policies and procedures.
Specifically, a Board Audit and Risk Management Committee (“BARMC”) comprising members of the Directors, has been
set up to oversee that risk management at all levels is being managed effectively. They, in turn, report all the risk
management activities to the Directors.
Commercial Banking
Group Risk Management (“GRM”)
The Banking Group has implemented risk management framework with the objective to ensure the overall financial
soundness and stability of the Banking Group’s business operations. The Banking Group’s risk management framework
outlines the overall governance structure, aspiration, values and risk management strategies which aligns the Banking
Group’s risk profile, capital strategies and return objectives. Appropriate methodologies and measurements have been
developed to manage uncertainties such that deviations from intended strategic objectives are closely monitored and kept
within tolerable levels.
248 • FINANCIALS

51 FINANCIAL INSTRUMENTS (continued)
(a) Financial risk management objectives and policies (continued)
Commercial Banking (continued)
Group Risk Management (“GRM”) (continued)
From a governance perspective, the Board has the overall responsibility to define the Banking Group’s risk appetite and
ensure that a robust risk management and compliance culture prevails. The Board is assisted by the Board Risk Management
Committee (“BRMC”) in approving the Banking Group’s risk management framework as well as the attendant capital
management and planning policy, risk appetite statements, risk management strategies and risk policies.
Dedicated management level committees are established by the Banking Group to oversee the development and the
effectiveness of risk management policies, to review risk exposures and portfolio composition as well as to ensure
appropriate infrastructures, resources and systems are put in place for effective risk management activities.
BRMC is supported by the GRM function. The GRM function has been established to provide independent oversight on
the adequacy, effectiveness and integrity of risk management practices at all levels within the Banking Group. The core
functions of the Banking Group’s GRM function is to support line management in identification and management of key
and emerging risks for the Banking Group, to measure these risks, to manage the risk positions and to determine the
optimum capital allocations. The Banking Group regularly reviews its risk management framework to reflect changes in
markets, products, regulatory and emerging best market practice.
Credit Risk Management
Credit risk arises as a result of customers or counterparties not being able to or willing to fulfil their financial and contractual
obligations as and when they fall due. These obligations arise from lending, trade finance and other activities undertaken
by the Banking Group. The Banking Group has established a credit risk governance policy to ensure that exposure to credit
risk is kept within the Banking Group’s financial capacity to withstand potential future losses. Lending activities are guided
by the internal credit policies and guidelines that are reviewed and concurred by the Management Credit Committee
(“MCC”), endorsed by the Credit Supervisory Committee (“CSC”) and the BRMC, and approved by the Board. These policies
are subject to review and enhancements, at least on an annual basis.
Credit portfolio strategies and significant exposures are reviewed by both the BRMC and the Board. These portfolio
strategies are designed to achieve a desired portfolio risk tolerance level and sector distribution.
The Banking Group’s credit approving process encompasses pre-approval evaluation, approval and post-approval evaluation.
While the business units are responsible for credit origination, the credit approving function rests mainly with the Credit
Evaluation Departments, the MCC and the CSC. The Board delegates approving and discretionary authority to the MCC and
the various personnel of the Banking Group based on job function and designation.
For any new products, credit risk assessment also forms part of the new product sign-off process to ensure that the new
product complies with the appropriate policies and guidelines, prior to the introduction of the product.

Credit Risk Management (continued)
The Banking Group’s exposure to credit risk is mainly from its retail, small and medium enterprise (“SME”), commercial
and corporate customers. The credit assessment for retail customers is managed on a portfolio basis and the risk scoring
models and lending templates are designed to assess the credit worthiness and the likelihood of the obligors to repay
their debts. The SME, commercial and corporate customers are individually assessed and assigned with a credit rating,
which is based on the assessment of relevant factors such as the customer’s financial position, industry outlook, types of
facilities and collaterals offered.
In addition, the Banking Group also conducts periodic stress testing of its credit portfolios to ascertain credit risk impact to
capital under the relevant stress scenarios.
Independent Credit Review Team conducts independent post approval reviews on sampling basis to ensure that quality
of credit appraisals, approval standards and operational robustness are in accordance with the credit standards, lending
policies and the directives established and approved by the Banking Group’s management.
Market Risk Management
Market risk is the risk of financial loss arising from exposure to adverse changes in values of financial instruments caused
by changes in market prices or rates, which include changes to interest rates.
The Banking Group adopts a systematic approach in managing such risks by types of instruments and nature of exposure.
Market risk is primarily controlled via a series of cut-loss limits and potential loss limits, i.e. Value at Risk (“VaR”), set in
accordance with the size of positions and risk tolerance appetites.
Portfolios held under the Banking Group’s trading books are tracked using daily mark-to-market positions, which are
compared against preset limits. The daily tracking of positions is supplemented by sensitivity analysis and stress tests,
using VaR and other measurements.
Foreign exchange risks arising from adverse exchange rate movements, is managed by the setting of preset limits,
matching of open positions against these preset limits and imposition of cut-loss mechanisms.
Interest rate risk is identified, measured and controlled through various types of limit. In addition, the Banking Group
regularly review the interest rate outlook and develop strategies to protect the total net interest income from adverse
changes in market interest rates. This applies to both interest rate risk exposures in the trading book and the banking
book. In managing interest rate risk in the banking book, the Banking Group measures earnings at risk and economic value
or capital at risk.
In addition, the Banking Group also conducts periodic stress testing of the respective portfolios and on an overall basis to
ascertain market risk under abnormal market conditions.
250 • FINANCIALS

Liquidity Risk Management
Liquidity risk is the risk of financial loss arising from the inability to fund increases in assets and/or meet obligations as
they fall due. Financial obligations arise from the withdrawal of deposits, funding of loans committed and repayment of
borrowed funds. It is the Banking Group’s policy to ensure there is adequate liquidity across all business units to sustain
ongoing operations, as well as sufficient liquidity to fund asset growth and strategic opportunities.
Besides adhering to the Regulatory Liquidity Requirement, the Banking Group has put in place a robust and comprehensive
liquidity risk management framework consisting of risk appetite, policies, triggers and controls which are reviewed and
concurred by the Banking Group Asset-Liability Committee, endorsed by the BRMC and approved by the Board. The key
elements of the framework cover proactive monitoring and management of cashflow, maintenance of high quality long-
term and short-term marketable debt securities, diversification of funding base as well as maintenance of a liquidity
compliance buffer to meet any unexpected cash outflows.
The Banking Group has in place liquidity contingency funding plans and stress test programmes to minimise the liquidity
risk that may arise due to unforeseen adverse changes in the marketplace. Contingency funding plan sets out the crisis
escalation process and the various strategies to be employed to preserve liquidity including an orderly communication
channel during liquidity crisis scenarios. Liquidity stress tests are conducted regularly to ensure there is adequate liquidity
contingency fund to meet the shortfalls during liquidity crisis scenarios.
Crisis Related Risk Management
Crisis related risk is the risk of loss arising from increased volatility and uncertainty, resulting in impact to the Banking
Group’s customers, financial markets and interruption on the Banking Group’s operations. Such loss could arise from
disruptive events such as a global pandemic, catastrophic climate change effects, geopolitical tensions and uncertainties
surrounding the global economic outlook.
The Banking Group has put in place a strategic plan to ensure that its operations and services are maintained fully
functional in the event of a crisis. The Banking Group remains cognizant of the need to continuously build and maintain
resilience, through close and active monitoring of potentially high impact events in the short term and longer term
horizon. The Banking Group continuously simulates and tests our preparedness to navigate through crisis conditions and
has subjected its Business Continuity Management (“BCM”) plans and processes through challenges based on various
scenarios. Consequently, the Banking Group continuously enhances its BCM plans and processes to strengthen its resilience
to endure future crises.

Environment, Social and Governance Risk Management
Environment, Social and Governance (“ESG”) Risks are a complex collective action problem that gives rise to financial loss
arising from current or prospective impacts of ESG factors. Financial risks may arise from Physical, Transition and Liability
Risk which spreads across most key assets of the Banking Group.
The Banking Group has integrated ESG and sustainability considerations within its business practices to ensure creation
of long-term socioeconomic benefits for the communities it serves. The Banking Group has in place a Sustainability Risk
Governance Framework which is aligned to the Banking Group’s overall Risk Management Framework. This provides a
structured approach towards identifying, evaluating, quantifying, monitoring, mitigating and reporting ESG risks.
Although ESG presents risks, the Banking Group has introduced initiatives that mitigate and adapt to these risks which
allows it to capitalise on potential opportunities to enhance resource efficiencies, adopt low-emission energy sources,
develop new green products and services, access new markets and further strengthen its resiliency against risks in
general.
Recognising the urgency for financial institutions to accelerate efforts to manage climate-related risks, the Banking Group
has established ESG related strategies, practices, processes and procedures to ensure it is able to continue to deliver long-
term value to its stakeholders in tandem with ESG related developments and aspirations.
Investment Banking
Risk management is one of the core activities of the Investment Banking Group to strike a balance between sound
practices and risk-return. An effective risk management is therefore vital to ensure that the Investment Banking Group
conducts its business in a prudent manner to ensure that the risk of potential losses is reduced.
Market risk
Market risk is the risk of loss arising from adverse fluctuation in market prices, such as interest rates, equity prices and
foreign currency. The Investment Banking Group monitors all such exposures arising from trading activities of the treasury
and stockbroking business activities on a daily basis and management is alerted on the financial impact of these risks. To
mitigate market risk, the Group also uses derivative financial instruments.
The Investment Banking Group has in place a set of policies, guidelines, measurement methodologies and control limits
which includes Value-at-Risk (“VaR”), Present-Value-Basis-Point (“PVBP”), Management Action Trigger (“MAT”), notional
limits and concentration limits to mitigating market risk.
Stress testing is also employed to capture the potential market risk exposures from unexpected market movements.
Concerns and significant findings are communicated to the senior management at the Assets and Liabilities Management
Committee (“ALMCO”) and to the Board.
252 • FINANCIALS

Investment Banking (continued)
Liquidity risk
Liquidity risk is the risk of financial loss arising from the inability to fund increases in assets and/or meet obligations as
they fall due. Financial obligations arises from the withdrawal of deposits, funding of loans committed and repayment of
borrowed funds. It is the Investment Banking Group’s policy to ensure that there is adequate liquidity across all business units
to sustain ongoing operations, as well as sufficient liquidity to fund asset growth and strategic opportunities.
Credit risk
Credit risk, or the risk of counterparties defaulting, is controlled by the application of credit approvals, credit limits and
monitoring procedures. Credit risk includes settlement risk, default risk and concentration risk. Exposure to credit risk
arises mainly from financing, underwriting, securities and derivative exposures of the Investment Banking Group.
The Investment Banking Group has set out Board approved policies and guidelines for the management of credit risk. To
oversee all credit related matters of the Investment Banking Group, the Management Credit and Underwriting Committee
(“MCUC”) was setup in 2011 in addition to an independent Credit Department.
The Board has delegated appropriate Delegation of Authority to the MCUC and senior management for the approval
of credit facilities. Credit limit setting for Treasury activities are endorsed by the MCUC and approved by the Board at
least annually. Adherence to established credit policies, guidelines and limits is monitored daily by the Credit Control
Department, Credit Department and the Risk Management Department.
Insurance
Insurers have to comply with the Malaysian Insurance Act and Regulations, including guidelines on investments. The Board
of Directors is responsible for formulating policies and overseeing the major risks including those risks associated with the
Financial Instruments described below.
The responsibility for the formulation, establishment and approval of the Insurance Group’s investment policies rests
with the Board of Directors as reported in the Corporate Governance Framework in the Directors’ Report. The deployment
and execution of the investment policies is delegated to the Investment Committee (“IC”) in which the members are
appointed by the Board of Directors. The IC oversees the formulation of investment and risk strategy and asset allocation
to determine the optimum risk and return profile.
Risk limits are in place at various levels and monitored by a risk manager to ensure all investment securities are compatible
with the Insurance Group’s investment principles and philosophy. Sensitivity and stress tests are carried out on a regular
basis to assess the resilience of the investment portfolios and the impact on the Insurance Group’s solvency. The Insurance
Group’s Asset and Liability Management (“ALM”) model is being deployed to address the Insurance Group’s assets and
liabilities match. The ALM model will enable management to assess the long-term impact of the investment strategy,
asset mix and product pricing strategy on the Insurance Group’s financial ability to meet its future obligations.

Insurance (continued)
Actuarial and underwriting risk
Actuarial risks relate to the adequacy of insurance premium rate levels to provide for insurance liabilities and solvency
margin and takes into consideration the developments in mortality, morbidity, lapses and expenses.
Underwriting risk represents the risk that claims incurred are higher than anticipated. This is attributable to the nature of
risk underwritten, random nature of claims frequency and severity of claims.
The Insurance Group manages the risks through strict underwriting guidelines, which include exclusions, cover limits,
loadings and reinsurance programmes. New risks are carefully assessed before an insurance policy is underwritten and
issued.
Credit risk
Credit risk is the risk of loss due to inability or unwillingness of an counterparty to service its debt obligations. The credit
risk and investment activities is monitored regularly with respect to single customer limit, sectorial exposure, credit rating
and residual maturity, in accordance with the investment guidelines and limits approved by the Board of Directors and the
authorities.
At the date of the statement of financial position, the credit exposure is within the investment guidelines and limits
approved by the Board of Directors and the authorities. The maximum exposure to credit risk is the carrying amount as
stated in the financial statements.
Interest rate risk
Investment activities and insurance business are inherently exposed to interest rate risk. This risk arises due to differences
in pricing or tenure of investments and liabilities. Interest rate risk is managed by targeting a desired return, which is
reviewed periodically, based on the Insurance Group’s long-term view on interest rates. Investment activities are managed
by appropriate asset allocation, which is regularly reviewed and changed in relation to the investment climate to meet the
Insurance Group’s desired return.
Market risk
Adverse changes in the equity market impairs the carrying value of the equity portfolio which could affect the solvency
of the Insurance Group. The Board has set internal limits for maximum equity exposure and individual stock exposure,
which are consistent with BNM’s guidelines and has also imposed daily trading limits. The Insurance Group’s investment
committee decides on the appropriate asset allocation for equities on a regular basis in line with the investment and
economic conditions at time of review.
254 • FINANCIALS

Insurance (continued)
Liquidity risk
Liquidity risk arises due to inability of the Insurance Group to meet its financial obligations as and when they fall due.
The Insurance Group manages liquidity risk via short term cash flows projection to determine net cash flow required. In
addition, the Insurance Group’s investible funds are substantially placed in fixed and call deposits and other money market
instruments. Should there be any abnormal and unexpected cash out flows required, the Insurance Group is still able to
meet its obligation in short period via the liquidation of bond holdings.
(b) Market risk
Market risk sensitivity assessment is based on the changes in key variables, such as interest rates, foreign currency rates
and equity risk, while all other variables remain unchanged. The sensitivity factors used are assumptions based on parallel
shifts in the key variables to project the impact on the assets and liabilities position of the Group and the Company as at
financial year end.
The scenarios used are simplified whereby it is assumed that all key variables for all maturities move at the same time
and by the same magnitude and do not incorporate actions that would be otherwise taken by the business units and risk
management to mitigate the effect of this movement in key variables. In reality, the Group and the Company proactively
seek to ensure that the interest rate risk profile is managed to minimise losses and optimise net revenues.
(i) Interest/profit rate risk sensitivity analysis
The interest/profit rate sensitivity results below shows the impact on profit after tax and equity of financial assets
or financial liabilities bearing floating interest/profit rates and fixed rate financial assets and financial liabilities.

Increase/(decrease) Increase/(decrease)
Impact Impact
on profit Impact on profit Impact
after tax on equity after tax on equity
RM’000 RM’000 RM’000 RM’000
2023
+ 100 basis points (“bps”) (164,436) (902,871) - -
- 100 bps 197,892 936,327 - -
2022
+ 100 bps (119,364) (820,663) (143) -
- 100 bps 154,348 855,647 143 -


(b) Market risk (continued)
(ii) Foreign currency risk sensitivity analysis
The Group and the Company take on exposure to the effects of fluctuations in the prevailing foreign currency
exchange rates on their financial position and cash flows.
The table below sets out the principal structure of foreign exchange exposures of the Group and the Company:
The Group
Net receivable/(payable)
exposure
2023 2022
RM’000 RM’000
United States Dollar (“USD”) (493,088) (213,099)

Euro (“EUR”) 42,707 7,263
Great Britain Pound (“GBP”) 30,119 3,917
Singapore Dollar (“SGD”) 39,024 (25,614)
Chinese Yuan Renminbi (“CNY”) (16,042) (226,826)
Hong Kong Dollar (“HKD”) 359,135 389,321
Japanese Yen (“JPY”) 5 5
Australian Dollar (“AUD”) (14,480) 21,641
Others 275,613 295,796
222,993 252,404
256 • FINANCIALS

(ii) Foreign currency risk sensitivity analysis (continued)
An analysis of the exposures to assess the impact of a one per cent change in the RM exchange rates to the profit
after tax are as follows:
The Group
Increase/(decrease)
2023 2022
RM’000 RM’000
+ 1%
United States Dollar (“USD”) 3,487 1,849
Euro (“EUR”) (324) (55)
Great Britain Pound (“GBP”) (229) (26)
Singapore Dollar (“SGD”) (165) 2,664
Chinese Yuan Renminbi (“CNY”) 122 1,726
Hong Kong Dollar (“HKD”) 184 2,542
Australian Dollar (“AUD”) 122 (165)
Others (2,111) (2,216)
1,086 6,319
- 1%
United States Dollar (“USD”) (3,487) (1,849)
Euro (“EUR”) 324 55
Great Britain Pound (“GBP”) 229 26
Singapore Dollar (“SGD”) 165 (2,664)
Chinese Yuan Renminbi (“CNY”) (122) (1,726)
Hong Kong Dollar (“HKD”) (184) (2,542)
Australian Dollar (“AUD”) (122) 165
Others 2,111 2,216
(1,086) (6,319)

(iii) Equity risk
Equity risk refers to the impact of change in equity positions held by the Group for yield purposes.
The Group
Increase/(decrease)
Impact
on profit Impact
after tax on equity
RM’000 RM’000
2023
+ 20% change in equity market price 106,236 -
- 20% change in equity market price (106,236) -
2022
+ 20% change in equity market price 99,854 91,738
- 20% change in equity market price (99,854) (91,738)

258 • FINANCIALS

(iv) Interest/profit rate risk
The tables below summarise the Group’s exposure to interest/profit rate risks. Included in the tables are the Group’s assets and liabilities at their full carrying amounts, categorised by the earlier of contractual
repricing or maturity dates. As interest/profit rates and yield curves change over time, the Group may be exposed to loss in earnings due to the effects of interest rates on the structure of the statements of financial
position. Sensitivity to interest rate arises from mismatches in the repricing dates, cash flows and other characteristics of the assets and their corresponding liabilities funding.
The Group
Non–trading book
Non-interest/
Up to >1 – 3 >3 -12 >1 – 5 Over 5 profit rate Trading
1 month months months years years sensitive book Total
Financial assets
Cash and short-term funds 8,458,028 68,499 80,000 - - 1,241,905 - 9,848,432
Deposits and placements with banks and other financial institutions - 709,976 358,464 - - 11,134 - 1,079,574
Financial assets at fair value through profit or loss - - 65,598 379,885 699,741 1,898,131 28,850,537 31,893,892
Financial investments at fair value through other comprehensive income 1,812,442 2,516,904 2,232,716 27,663,594 1,124,495 374,634 - 35,724,785
Financial investments at amortised cost 719,795 50,031 958,332 29,234,613 1,056,729 312,803 - 32,332,303
- Trading derivatives - - - - - - 2,225,101 2,225,101
- Hedging derivatives - - - 6,647 3,866 - - 10,513
Loans, advances and financing
- Performing 147,506,115 3,079,387 1,580,720 7,864,109 19,650,709 255,635 - 179,936,675
- Impaired ^ 60,276 9,123 6,134 89,603 465,604 - - 630,740
Clients’ and brokers’ balances - - - - - 618,824 - 618,824
Other receivables 100,459 157 705 2,195 - 2,452,511 - 2,556,027
Statutory deposits with Central Banks - - - - - 3,449,270 - 3,449,270
Total financial assets 158,657,115 6,434,077 5,282,669 65,240,646 23,001,144 10,614,847 31,075,638 300,306,136
^ This represents outstanding impaired loans after deducting expected credit losses.

(iv) Interest/profit rate risk (continued)
position. Sensitivity to interest rate arises from mismatches in the repricing dates, cash flows and other characteristics of the assets and their corresponding liabilities funding. (continued)
The Group
Non–trading book
Non-interest/
Financial liabilities
Deposits from customers 79,130,813 41,974,775 43,919,319 5,364,619 841,095 40,236,822 - 211,467,443
Investment accounts of customers 448,208 859,166 930,546 - - 12,593 - 2,250,513
Deposits and placements of banks and other financial institutions 5,368,349 5,227,428 315,766 1,478,344 22,139 40,034 - 12,452,060
Obligations on securities sold under repurchase agreements 2,678,098 4,718,922 - - - 2,563 - 7,399,583
Bills and acceptance payable 4,314 29,963 30,168 - - 146,986 - 211,431
- Hedging derivatives - - - 35 - - - 35
Payables and other liabilities 2,240 434 13,298 183 - 11,527,198 163,076 11,706,429
Recourse obligations on loans/financing sold to Cagamas Berhad - - - 2,950,040 - 22,180 - 2,972,220
Provision for claims - - - - - 396,780 17,567 414,347
Borrowings - - - 200,000 - 1,936 - 201,936
Multi-currency Additional Tier 1 capital securities - - 394,617 1,304,261 - 20,752 - 1,719,630
Subordinated obligations - - 998,136 649,089 549,998 9,427 - 2,206,650
Lease liabilities 4,031 7,594 33,169 119,294 14,906 9,261 3,756 192,011
Insurance funds - - - - - 19,327,232 115,679 19,442,911
Total financial liabilities 87,636,053 52,818,282 44,635,019 12,065,865 1,428,138 71,899,157 2,747,474 275,229,988
Net interest sensitivity gap 71,021,062 (46,384,205) (41,352,350) 53,174,781 21,573,006
Financial guarantees - - - - - 1,045,877

Credit related commitments and contingencies - - - - - 51,350,522
Treasury related commitments and contingencies (hedging) - - - 469,048 72,619 -
Net interest sensitivity gap - - - 469,048 72,619 52,396,399
260 • FINANCIALS

The Group
Non–trading book
Non-interest/
Financial assets
Cash and short-term funds 8,007,675 291,195 - - - 1,307,024 - 9,605,894
Deposits and placements with banks and other financial institutions - 926,643 367,258 - - 6,845 - 1,300,746
Financial assets at fair value through profit or loss - 15,264 6,806 195,032 634,820 3,309,683 25,309,024 29,470,629
Financial investments at fair value through other comprehensive income 921,028 1,023,891 905,341 19,396,428 4,892,707 313,548 - 27,452,943
Financial investments at amortised cost 4,370,742 230,080 1,203,719 22,373,916 5,067,716 362,684 - 33,608,857
- Hedging derivatives - - - 707 9,680 - - 10,387
- Performing 140,557,250 732,314 1,470,703 8,977,056 14,659,740 296,137 - 166,693,200
- Impaired^ 69,568 5,164 6,489 52,546 350,336 - - 484,103
Other receivables 126,102 157 705 3,134 - 2,214,173 - 2,344,271
Statutory deposits with Central Banks - - - - 248,512 272,138 - 520,650
Total financial assets 154,052,365 3,224,708 3,961,021 50,998,819 25,863,511 8,804,413 27,200,806 274,105,643
^ This represents outstanding impaired loans after deducting expected credit losses.

The Group
Non–trading book
Non-interest/
Up to >1 – 3 >3 - 12 >1 – 5 Over 5 profit rate Trading
Deposits from customers 79,144,766 35,679,741 37,937,516 4,727,875 1,704,736 38,188,287 - 197,382,921
Investment accounts of customers 975,190 1,457,150 226,629 - - 9,439 - 2,668,408
Deposits and placements of banks and other financial institutions 4,872,554 1,209,531 534,761 1,557,628 21,973 33,038 - 8,229,485
Obligations on securities sold under repurchase agreements 1,117,131 2,662,226 - - 187,726 4,221 - 3,971,304
Bills and acceptance payable 3,044 15,461 11,389 - - 211,467 - 241,361
- Hedging derivatives - 361 - 113 - - - 474
Payables and other liabilities 2,209 434 13,850 183 - 11,519,770 125,386 11,661,832
Recourse obligations on loans/financing sold to Cagamas Berhad - 362,918 600,039 650,012 - 10,967 - 1,623,936
Provision for claims - - - - - 319,045 18,960 338,005
Borrowings 210,000 - - 200,073 - 1,858 - 411,931
Multi-currency Additional Tier 1 capital securities - - 799,916 892,649 3,282 20,002 - 1,715,849
Subordinated obligations - - 499,970 1,150,000 548,345 8,768 - 2,207,083
Lease liabilities 3,970 7,736 33,853 145,483 8,661 7,960 4,936 212,599
Insurance funds - - - - - 17,444,519 79,670 17,524,189
Total financial liabilities 86,328,864 41,395,558 40,657,923 9,324,016 2,474,723 68,086,242 1,993,484 250,260,810
Net interest sensitivity gap 67,723,501 (38,170,850) (36,696,902) 41,674,803 23,388,788
Financial guarantees - - - - - 745,430

Credit related commitments and contingencies - - - - - 49,469,718
Treasury related commitments and contingencies (hedging) - - 100,000 476,190 86,905 -
Net interest sensitivity gap - - 100,000 476,190 86,905 50,215,148
262 • FINANCIALS

The tables below summarise the Company’s exposure to interest/profit rate risks. Included in the tables are the Company’s assets and liabilities at their full carrying amounts, categorised by the earlier of contractual
repricing or maturity dates. As interest/profit rates and yield curves change over time, the Company may be exposed to loss in earnings due to the effects of interest rates on the structure of the statements of
financial position. Sensitivity to interest rate arises from mismatches in the repricing dates, cash flows and other characteristics of the assets and their corresponding liabilities funding.
The Company
Non-trading book
Up to >1 - 3 >3 - 12 >1 - 5 Over 5 Non-interest Trading
Financial assets
Cash and short-term funds 65,246 - - - - - - 65,246
Deposits and placements with banks and other financial institutions - 67,860 - - - - - 67,860
Other receivables 78 157 705 2,195 - 1,996 - 5,131
Total financial assets 65,324 68,017 705 2,195 - 1,996 - 138,237
Payables and other liabilities 346 - 12,279 - - 2,150 - 14,775
Borrowings
- Senior notes - - - 200,000 - 1,919 - 201,919
Multi-currency Additional Tier 1 capital securities - - 400,000 - - 4,851 - 404,851
Subordinated obligations - - 1,100,000 - - 1,859 - 1,101,859
Lease liabilities 77 155 713 2,408 - - - 3,353
Total financial liabilities 423 155 1,512,992 202,408 - 10,779 - 1,726,757
Net interest sensitivity gap 64,901 67,862 (1,512,287) (200,213) -


The tables below summarise the Company’s exposure to interest/profit rate risks. Included in the tables are the Company’s assets and liabilities at their full carrying amounts, categorised by the earlier of contractual
repricing or maturity dates. As interest/profit rates and yield curves change over time, the Company may be exposed to loss in earnings due to the effects of interest rates on the structure of the statements of
financial position. Sensitivity to interest rate arises from mismatches in the repricing dates, cash flows and other characteristics of the assets and their corresponding liabilities funding. (continued)
The Company
Non-trading book
Up to >1 - 3 >3 - 12 >1 - 5 Over 5 Non-interest Trading
Financial assets
Cash and short-term funds 26,609 - - - - - - 26,609
Deposits and placements with banks and other financial institutions - 3,360 - - - - - 3,360
Other receivables 78 157 705 3,134 - 1,271 - 5,345
Total financial assets 26,687 3,517 705 3,134 - 1,271 - 35,314
Payables and other liabilities 315 - 12,831 - - 1,722 - 14,868
Borrowings
- Revolving credit 100,000 - - - - 75 - 100,075
- Commercial papers 110,000 - - - - (80) - 109,920
- Senior notes - - - 200,000 - 1,863 - 201,863
Multi-currency Additional Tier 1 capital securities - - 400,000 400,000 - 6,431 - 806,431
Subordinated obligations - - - - 1,600,000 1,624 - 1,601,624
Lease liabilities 73 147 676 3,353 - - - 4,249
Total financial liabilities 210,388 147 413,507 603,353 1,600,000 11,635 - 2,839,030
Net interest sensitivity gap (183,701) 3,370 (412,802) (600,219) (1,600,000)

264 • FINANCIALS

(c) Liquidity risk
Liquidity risk is defined as the current and prospective risk arising from the inability of the Group and the Company to meet its contractual or regulatory obligations when they become due without incurring substantial
losses. The liquidity risk is identified based on concentration, volatility of source of fund and funding maturity structure and it is measured primarily using Bank Negara Malaysia’s New Liquidity Framework and depositor’s
concentration ratios. The Group and the Company seek to project, monitor and manage its liquidity needs under normal as well as adverse circumstances.
The table below analyses the carrying amount of assets and liabilities (include non-financial instruments) based on the remaining contractual maturity:
The Group
Up to 1 week to 1 to 3 3 to 6 6 to 12 Over 1 No specific
1 week 1 month months months months year maturity Total
Assets
Cash and short-term funds 7,528,294 2,084,906 68,499 80,000 - - 86,733 9,848,432
Deposits and placements with banks and other financial institutions - 138,214 581,304 155,326 204,668 - 62 1,079,574
Financial assets at fair value through profit or loss 103,473 1,590,438 29,757 524,421 843,899 21,693,835 7,108,069 31,893,892
Financial investments at fair value through other comprehensive income 311,632 1,454,998 1,720,433 329,827 1,907,888 29,902,357 97,650 35,724,785
Financial investments at amortised cost 787,556 387 72,782 118,541 876,173 30,476,864 - 32,332,303
Derivative financial instruments 70,674 188,651 593,041 186,680 146,457 1,050,111 - 2,235,614
Loans, advances and financing 14,677,964 7,321,276 7,192,416 2,685,273 1,303,877 147,386,609 - 180,567,415
Clients’ and brokers’ balances 140,476 - - - 478,348 - - 618,824
Other receivables 1,283,843 15,032 29,590 38,878 94,946 3,965 1,211,495 2,677,749
Statutory deposits with Central Banks - - - - - - 3,449,270 3,449,270
Tax recoverable - - - - 4,289 - 618 4,907
Investment in associated companies - - - - - - 10,050,740 10,050,740
Deferred tax assets - - - - 24,331 - 83,543 107,874
Property and equipment - - - - - - 1,214,879 1,214,879
Investment properties - - - - - - 471,630 471,630
Goodwill arising on consolidation - - - - - - 2,410,644 2,410,644
Intangible assets - - - - - - 387,918 387,918
Right-of-use assets - 78 157 235 470 2,195 186,205 189,340
Total assets 24,905,912 12,793,980 10,287,979 4,119,181 5,885,346 230,515,936 26,759,456 315,265,790

(c) Liquidity risk (continued)
The table below analyses the carrying amount of assets and liabilities (include non-financial instruments) based on the remaining contractual maturity: (continued)
The Group
Liabilities
Investment accounts of customers 124,237 328,935 864,075 908,983 24,283 - - 2,250,513
Deposits and placements of banks and other financial institutions 3,853,244 1,551,423 5,230,031 142,636 174,244 1,500,482 - 12,452,060
Obligations on securities sold under repurchase agreements 1,175,840 1,505,098 4,718,645 - - - - 7,399,583
Bills and acceptances payable 314 4,000 29,963 30,168 - - 146,986 211,431
Clients’ and brokers’ balances 145,393 - - - - - - 145,393
Payables and other liabilities 5,673,051 1,415,059 161,855 8,206 4,686,763 20,462 89,060 12,054,456
Recourse obligations on loans/financing sold to Cagamas Berhad - - 15,203 6,977 - 2,950,040 - 2,972,220
Provision for claims - - - - 414,347 - - 414,347
Provision for taxation - - - - 7,744 - 50,397 58,141
Borrowings - - - 1,936 - 200,000 - 201,936
Multi-currency Additional Tier 1 capital securities - - 4,862 15,891 394,617 1,304,260 - 1,719,630
Subordinated obligations - - 4,652 4,775 998,136 1,199,087 - 2,206,650
Lease liabilities 237 4,032 8,453 12,303 23,914 143,072 - 192,011
Insurance funds - 6,911 65 440 7,530,463 11,905,032 - 19,442,911
Total liabilities 96,426,939 36,975,213 53,817,499 25,713,910 34,348,441 28,067,711 286,443 275,636,156
Total equity - - - - - - 39,629,634 39,629,634
Total liabilities and equity 96,426,939 36,975,213 53,817,499 25,713,910 34,348,441 28,067,711 39,916,077 315,265,790
Net liquidity gap (71,523,027) (24,181,233) (43,529,520) (21,594,729) (28,463,095) 202,448,225

266 • FINANCIALS

The Group
Assets
Cash and short-term funds 5,306,682 3,881,384 291,195 - - - 126,633 9,605,894
Deposits and placements with banks and other financial institutions - 100,021 831,311 366,214 3,139 - 61 1,300,746
Financial assets at fair value through profit or loss 316,574 1,110,143 1,110,675 388,372 244,068 18,598,072 7,702,725 29,470,629
Financial investments at fair value through other comprehensive income 399,843 522,737 1,011,973 134,190 616,442 24,684,372 83,386 27,452,943
Financial investments at amortised cost 96,866 4,352,807 251,194 255,838 1,014,103 27,638,049 - 33,608,857
Derivative financial instruments 46,061 164,821 433,512 138,025 123,545 996,205 - 1,902,169
Loans, advances and financing 13,501,595 8,377,197 5,183,381 2,808,015 1,036,259 136,270,856 - 167,177,303
Clients’ and brokers’ balances 316,276 - - - 405,905 - - 722,181
Other receivables 1,344,550 13,623 17,632 23,109 49,043 6,275 977,268 2,431,500
Statutory deposits with Central Banks - - - - - - 520,650 520,650
Tax recoverable - - - - 5,742 - 520 6,262
Investment in associated companies - - - - - - 7,660,825 7,660,825
Deferred tax assets - - - - 56,596 - 308,335 364,931
Property and equipment - - - - - - 1,274,380 1,274,380
Investment properties - - - - - - 471,610 471,610
Goodwill arising on consolidation - - - - - - 2,410,644 2,410,644
Intangible assets - - - - - - 324,938 324,938
Right-of-use assets - 78 157 235 470 3,135 210,280 214,355
Total assets 21,328,447 18,522,811 9,131,030 4,113,998 3,555,312 208,196,964 22,072,255 286,920,817

The Group
Liabilities
Investment accounts of customers 232,455 744,106 1,463,800 105,564 122,483 - - 2,668,408
Deposits and placements of banks and other financial institutions 3,030,676 1,872,390 1,210,850 419,733 116,236 1,579,600 - 8,229,485
Obligations on securities sold under repurchase agreements 96,323 1,022,185 2,664,629 - - 188,167 - 3,971,304
Bills and acceptances payable 143 2,901 15,461 11,382 8 - 211,466 241,361
Clients’ and brokers’ balances 306,901 - - - - - - 306,901
Payables and other liabilities 5,456,674 1,775,319 130,674 8,822 4,520,956 20,167 88,402 12,001,014
Recourse obligations on loans/financing sold to Cagamas Berhad - - 372,882 601,042 - 650,012 - 1,623,936
Provision for claims - - - - 338,005 - - 338,005
Provision for taxation - - - - 22,188 - 308,913 331,101
Borrowings - 209,996 - - - 201,935 - 411,931
Multi-currency Additional Tier 1 capital securities - - 4,859 810,360 - 900,630 - 1,715,849
Subordinated obligations - - 4,652 2,492 499,970 1,699,969 - 2,207,083
Lease liabilities 316 3,971 8,368 12,305 24,034 163,605 - 212,599
Insurance funds - 78 183 15,154 6,209,038 11,299,736 - 17,524,189
Total liabilities 94,352,332 35,597,880 41,893,812 20,201,788 31,986,614 26,289,886 608,781 250,931,093
Total equity - - - - - - 35,989,724 35,989,724

Total liabilities and equity 94,352,332 35,597,880 41,893,812 20,201,788 31,986,614 26,289,886 36,598,505 286,920,817
Net liquidity gap (73,023,885) (17,075,069) (32,762,782) (16,087,790) (28,431,302) 181,907,078

268 • FINANCIALS

The Company
Assets
Cash and short-term funds 8,246 57,000 - - - - - 65,246
Deposits and placements with banks and other financial institutions - - 67,860 - - - - 67,860
Other receivables - 2 330 - - 1,918 - 2,250
Tax recoverable - - - - - - 464 464
Investment in subsidiary companies - - 4,862 2,167 1,500,000 - 17,051,847 18,558,876
Deferred tax assets - - - - - - 203 203
Property and equipment - - - - - - 5,341 5,341
Intangible assets - - - - - - 137 137
Right-of-use assets - 78 157 235 470 2,195 - 3,135
Total assets 8,246 57,080 73,209 2,402 1,500,470 4,113 17,057,992 18,703,512
Liabilities
Payables and other liabilities - - 346 1,017 11,262 2,150 - 14,775
Borrowings
- Senior notes - - - 1,919 - 200,000 - 201,919
Multi-currency Additional Tier 1 capital securities - - - 4,851 400,000 - - 404,851
Subordinated obligations - - - 1,859 1,100,000 - - 1,1101,859
Lease liabilities - 77 155 235 479 2,407 - 3,353
Total liabilities - 77 501 9,881 1,511,741 204,557 - 1,726,757
Total equity - - - - - - 16,976,755 16,976,755
Total liabilities and equity - 77 501 9,881 1,511,741 204,557 16,976,755 18,703,512
Net liquidity gap 8,246 57,003 72,708 (7,479) (11,271) (200,444)


51 FINANCIAL INSTRUMENTSV (continued)
The Company
Assets
Cash and short-term funds 1,715 24,894 - - - - - 26,609
Deposits and placements with banks and other financial institutions - - 3,360 - - - - 3,360
Other receivables - - 1 - - 2,634 - 2,635
Tax recoverable - - - - - - 492 492
Investment in subsidiary companies - - 4,863 404,232 - - 19,050,333 19,459,428
Deferred tax assets - - - - - - 229 229
Property and equipment - - - - - - 4,803 4,803
Intangible asset - - - - - - 76 76
Right-of-use assets - 78 157 235 470 3,135 - 4,075
Total assets 1,715 24,972 8,381 404,467 470 5,769 19,055,933 19,501,707
Liabilities
Payables and other liabilities - 315 - 995 11,836 1,722 - 14,868
Borrowings
- Revolving credits - 100,075 - - - - - 100,075
- Commercial papers - 109,920 - - - - - 109,920
- Senior notes - - - - - 201,863 - 201,863
Multi-currency Additional Tier 1 capital securities - - - 401,732 - 404,699 - 806,431
Subordinated obligations - - - - - 1,601,624 - 1,601,624
Lease liabilities - 73 147 223 454 3,352 - 4,249
Total liabilities - 210,383 147 402,950 12,290 2,213,260 - 2,839,030
Total equity - - - - - - 16,662,677 16,662,677
Total liabilities and equity - 210,383 147 402,950 12,290 2,213,260 16,662,677 19,501,707
Net liquidity gap 1,715 (185,411) 8,234 1,517 (11,820) (2,207,491)

270 • FINANCIALS

The following table shows the contractual undiscounted cash flows payable for financial liabilities by remaining contractual maturities. The balances in the table below will not agree to the balances reported in the
statements of financial position as the table incorporates all contractual cash flows, on an undiscounted basis, relating to both principal and interest payments. The contractual maturity profile does not necessarily reflect
the behavioural cash flows.
The Group
Up to 1 to 3 3 to 12 1 to 5 Over 5
1 month months months years years Total
2023 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Deposits from customers 62,263,412 48,149,310 55,088,291 48,259,124 1,684,848 215,444,985
Investment accounts of customer 444,931 919,787 968,025 - - 2,332,743
Deposits and placements of banks and other financial institutions 6,563,298 4,205,625 358,644 1,099,967 397,054 12,624,588
Obligations on securities sold under repurchase agreements 2,682,317 4,719,522 - - - 7,401,839
Bills and acceptances payable 146,986 5,700 12,087 - - 164,773
- Gross settled derivatives
- Inflow (13,279,406) (14,965,434) (4,955,367) (3,972,926) (118,311) (37,291,444)
- Outflow 13,692,376 15,616,309 5,229,804 4,284,947 131,787 38,955,223
- Net settled derivatives 43,863 68,989 347,538 626,874 109,254 1,196,518
Clients’ and brokers’ balances 145,393 - - - - 145,393
Payables and other liabilities 6,900,160 145,242 4,668,314 17,476 3,347 11,734,539
Recourse obligations on loans/financing sold to Cagamas Berhad - 27,256 90,684 3,101,511 - 3,219,451
Provision for claims - - 414,347 - - 414,347
Borrowings - 2,827 2,890 202,842 - 208,559
Multi-currency Additional Tier 1 capital securities - 19,237 878,039 1,485,976 - 2,383,252
Subordinated obligations - 7,860 2,229,664 827,115 580,049 3,644,688
Lease liabilities 4,957 10,953 40,632 124,442 35,361 216,345
Insurance funds 6,911 65 7,618,218 3,998,633 18,601,080 30,224,907
Total financial liabilities 79,615,198 58,933,248 72,991,810 60,055,981 21,424,469 293,020,706

(C) Liquidity risk (continued)
the behavioural cash flows. (continued)
The Group
Up to 1 to 3 3 to 12 1 to 5 Over 5
1 month months months years years Total
2022 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Deposits from customers 61,373,701 40,597,258 48,187,735 47,439,915 2,834,423 200,433,032
Investment accounts of customer 518,105 1,125,721 1,076,127 - - 2,719,953
Deposits and placements of banks and other financial institutions 5,034,430 1,162,632 592,906 1,062,663 516,938 8,369,569
Obligations on securities sold under repurchase agreements 1,119,639 2,670,623 - - - 3,790,262
Bills and acceptances payable 211,666 - - - - 211,666
- Gross settled derivatives
- Inflow (9,451,882) (5,239,105) (4,635,703) (2,728,214) (113,232) (22,168,136)
- Outflow 9,568,214 5,357,199 4,768,773 2,877,443 118,371 22,690,000
- Net settled derivatives 112 53,384 280,761 865,118 92,752 1,292,127
Clients’ and brokers’ balances 306,901 - - - - 306,901
ayables and other liabilities 7,055,631 103,191 4,482,648 15,289 5,072 11,661,831
Recourse obligations on loans/financing sold to Cagamas Berhad 10,498 376,820 626,213 691,934 - 1,705,465
Provision for claims - - 338,005 - - 338,005
Borrowings 528 3,839 7,330 423,776 - 435,473
Multi-currency Additional Tier 1 capital securities - 19,237 879,864 1,092,300 - 1,991,401
Subordinated obligations - 7,860 1,131,958 802,594 609,867 2,552,279
Lease liabilities 4,928 11,071 41,256 133,349 50,265 240,869
Insurance funds 78 199 6,309,946 3,908,640 17,030,343 27,249,206
Total financial liabilities 75,752,549 46,249,929 64,087,819 56,584,807 21,144,799 263,819,903
272 • FINANCIALS

the behavioural cash flows. (continued)
The Company
Up to 1 1 to 3 3 to 12 1 to 5 Over 5
month months months years years Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
2023
Payables and other liabilities - - 12,625 2,150 - 14,775
Borrowings
- Senior notes - 2,827 2,873 202,842 - 208,542
Multi-currency Additional Tier 1 capital securities - 9,719 409,614 - - 419,333
Subordinated obligations - - 1,147,430 - - 1,147,430
Total financial liabilities - 12,546 1,572,542 204,992 - 1,790,080
2022
Payables and other liabilities 315 - 12,831 - 1,721 14,867
Borrowings
- Revolving credit 302 600 2,644 101,249 - 104,795
- Commercial papers 226 412 1,813 113,912 - 116,363
- Senior notes - 2,827 2,873 208,542 - 214,242
Multi-currency Additional Tier 1 capital securities - 9,719 420,107 419,333 - 849,159
Subordinated obligations - - 571,882 1,147,430 - 1,719,312
Total financial liabilities 843 13,558 1,012,150 1,990,466 1,721 3,018,738

The following table presents the contractual expiry by maturity of the Group’s commitments and contingencies:
The Group
Less than Over
1 year 1 year Total
RM’000 RM’000 RM’000
2023
Direct credit substitutes 153,828 71,687 225,515
Any commitment that are unconditionally cancelled at anytime
by the Group without prior notice 917,463 - 917,463
Short-term self liquidating trade related contingencies 820,362 - 820,362
Obligations under underwriting agreement - - -
Irrevocable commitments to extend credit 26,457,159 17,073,556 43,530,715
Unutilised credit card lines 6,902,344 - 6,902,344
Total commitments and contingencies 35,251,156 17,145,243 52,396,399
2022
Direct credit substitutes 137,903 200 138,103
Any commitment that are unconditionally cancelled at anytime
by the Group without prior notice 919,747 - 919,747
Short-term self liquidating trade related contingencies 607,327 - 607,327
Obligations under underwriting agreement 7,140 - 7,140
Irrevocable commitments to extend credit 23,913,907 17,538,803 41,452,710
Unutilised credit card lines 7,090,121 - 7,090,121
Total commitments and contingencies 32,676,145 17,539,003 50,215,148
Undrawn loan commitments are recognised at activation stage and include commitments which are unconditionally
cancellable by the Group. The Group expect that not all of the contingent liabilities and undrawn loan commitments will
be drawn before expiry.
(d) Credit risk
(i) Maximum exposure to credit risk
The maximum exposure to credit risk for financial assets recognised in the statements of financial position is their
carrying amounts. For contingent liabilities, the maximum exposure to credit risk is the maximum amount that the
Group and the Company would have to pay if the obligations of the instruments issued are called upon. For credit
commitments, the maximum exposure to credit risk is the full amount of the undrawn credit facilities granted to
customers.
274 • FINANCIALS

(d) Credit risk (continued)
(i) Maximum exposure to credit risk (continued)
The table below shows the maximum exposure to credit risk for the Group and the Company that are subject to
impairment:

2023 2022 2023 2022
RM’000 RM’000 RM’000 RM’000
Credit risk exposure relating to on-balance

sheet assets:
Short-term funds and placements with
banks and other financial institutions
(exclude cash in hand) 9,409,365 9,530,886 133,106 29,969
Financial assets and investments
portfolios (exclude shares and unit trust
investments)
- Financial investments at FVOCI 35,627,135 27,369,557 - -
- Financial investments at amortised cost 32,332,302 33,608,856 - -
Loans, advances and financing 180,567,415 167,177,303 - -
Clients’ and brokers’ balances 618,824 722,181 - -
Other receivables 2,452,511 2,214,173 1,996 1,271
261,007,552 240,622,956 135,102 31,240
Credit risk exposure relating to off-balance

sheet assets:
Commitments and contingencies 52,396,399 50,215,148 - -
Total maximum credit risk exposure 313,403,951 290,838,104 135,102 31,240

(i) Maximum exposure to credit risk (continued)
The table below shows the credit exposure of the Group and the Company that are not subject to impairment:
The Group
2023 2022
RM’000 RM’000
Financial assets at FVTPL 23,405,095 21,518,805

Derivative assets 2,235,614 1,902,169
25,640,709 23,420,974
(ii) Collaterals
The main type of collaterals obtained by the Group are as follows:
(a) Fixed deposits, Mudharabah General Investment Account, negotiable instrument of deposits, foreign currency
deposits and cash deposits/margins
(b) Land and buildings
(c) Aircrafts, vessels and automobiles
(d) Quoted shares, unit trust, Malaysian Governments Bonds and securities and private debt securities
(e) Endowment life policies with cash surrender value
(f) Other tangible business assets, such as inventory and equipment
The Group also accept non-tangible securities such as support, guarantees from individuals, corporates and
institutions, bank guarantees, debentures, assignment of contract payments, which are subject to internal guidelines
on eligibility.
The outstanding balance for loans, advances and financing for which no allowances is recognised because of
collateral amounted to RM90.3 million (2022: RM94.5 million) for the Group.
The financial effect of collateral (quantification to the extent to which collateral and other credit enhancements
mitigate credit risk) held for loans, advances and financing for the Group is 87.25% (2022: 87.23%). The financial
effects of collateral held for the remaining financial assets are insignificant.
The financial effect of collateral (quantification to the extent to which collateral and other credit enhancements
mitigate credit risk) held for net loans, advances and financing that are credit impaired for the Group is 72.11%
(2022: 76.11%).
276 • FINANCIALS

(iii) Credit exposure by stage
Financial assets of the Group and the Company are classified into three stages as below:
Stages Description
Stage 1: 12 months ECL Stage 1 includes financial assets which have not had a significant increase in
- not credit impaired credit risk since initial recognition or which have low credit risk at reporting date.
12-months ECL is recognised and interest income is calculated on the gross carrying
amount of the financial assets.
Stage 2: Lifetime ECL Stage 2 includes financial assets which have had a significant increase in credit
- not credit impaired risk since initial recognition (unless they have low credit risk at the reporting date)
but do not have objective evidence of impairment. Lifetime ECL is recognised and
interest income is calculated on the gross carrying amount of the financial assets.
Stage 3: Lifetime ECL Stage 3 includes financial assets that have objective evidence of impairment at the
- credit impaired reporting date. Lifetime ECL is recognised and interest income is calculated on the
net carrying amount of the financial assets.
For further details on the stages, refer to accounting policy Note O.
(iv) Credit quality
The Group assess credit quality of loans and advances using internal rating techniques tailored to the various
categories of products and counterparties. These techniques have been developed internally and combine statistical
analysis with credit officers judgement.
Credit quality description is summarised as follows:
Credit quality Description
Good Obligors in this category exhibit strong capacity to meet financial commitments.
Adequate Obligors in this category have a fairly acceptable capacity to meet financial
commitments.
Marginal Obligors in this category have uncertain capacity to meet financial commitments
and is under closer monitoring.
No rating Obligors which are currently not assigned with a credit ratings as it do not satisfy
the criteria to be rated based on internal credit rating system.
Credit impaired Obligors assessed to be impaired.


(iv) Credit quality (continued)
The credit quality of financial instruments other than loans, advances and financing are determined based on the
ratings of counterparties as defined equivalent rating of other international rating agencies as defined below.
Sovereign Refer to financial asset issued by federal government or guarantee by federal

government.
Investment grade Refers to the credit quality of the financial asset that the issuer is able to meet
payment obligation and exposure bondholder to low credit risk of default.
Non-investment grade Refers to low credit quality of the financial asset that is highly expose to default
risk.
Un-graded Refers to financial assets which are currently not assigned with ratings due to
unavailability of rating models.
Credit impaired Refers to the asset that is being impaired.
The following table shows an analysis of the credit exposure by stages, together with the ECL allowance provision:
The Group Stage 1 Stage 2 Stage 3 Total

2023 RM’000 RM’000 RM’000 RM’000
Short-term funds and placements with banks

and other financial institutions (exclude cash
in hand):
Sovereign 4,396,228 - - 4,396,228
Investment grade 4,811,189 - - 4,811,189
Non-Investment grade 202,171 - - 202,171
Gross carrying amount 9,409,588 - - 9,409,588
Expected credit losses (223) - - (223)
Net carrying amount 9,409,365 - - 9,409,365
278 • FINANCIALS

(continued)

2023 RM’000 RM’000 RM’000 RM’000
Financial investments at FVOCI:

Sovereign 23,021,315 - - 23,021,315
Non-investment grade 107,580 - - 107,580
Un-graded 28,935 - - 28,935
Expected credit losses (2,014) - - (2,014)
Financial investments at amortised cost:

Sovereign 30,591,209 - - 30,591,209
Loans, advances and financing:

Good 150,605,536 117,253 - 150,722,789
Adequate 23,418,533 1,285,854 - 24,704,387
Marginal - 5,310,466 - 5,310,466
Un-graded 557,834 4,131 - 561,965
Credit impaired - - 1,042,010 1,042,010
Gross carrying amount 174,581,903 6,717,704 1,042,010 182,341,617
Expected credit losses (966,580) (381,778) (411,144) (1,759,502)
Others* (14,700) - - (14,700)
Net carrying amount 173,600,623 6,335,926 630,866 180,567,415
* Included fair value changes arising from fair value hedges.


(continued)

2022 RM’000 RM’000 RM’000 RM’000
Short-term funds and placements with banks

and other financial institutions (exclude cash
in hand):
Sovereign 4,117,655 - - 4,117,655
Un-graded 1,467,607 - - 1,467,607
Financial investments at FVOCI:

Sovereign 18,760,424 - - 18,760,424
Un-graded 654,439 - - 654,439
Expected credit losses (1,729) - - (1,729)
Financial investments at amortised cost:

Sovereign 31,817,634 - - 31,817,634
Investment grade 540,848 - - 540,848
Un-graded 1,250,442 - - 1,250,442
280 • FINANCIALS

(continued)

2022 RM’000 RM’000 RM’000 RM’000
Loans, advances and financing:

Good 130,880,036 193,547 - 131,073,583
Adequate 20,109,077 1,767,203 - 21,876,280
Marginal - 14,525,676 - 14,525,676
Un-graded 619,321 9,316 - 628,637
Credit impaired - - 819,878 819,878
Gross carrying amount 151,608,434 16,495,742 819,878 168,924,054
Expected credit losses (977,229) (423,913) (335,647) (1,736,789)
Others* (9,962) - - (9,962)
Net carrying amount 150,621,243 16,071,829 484,231 167,177,303
* Included fair value changes arising from fair value hedges.
(v) Collateral and other credit enhancements obtained
The Group
2023 2022
RM’000 RM’000
Properties 377,172 352,321
Repossessed properties are made available-for-sale in an orderly fashion, with the proceeds used to reduce or repay
the outstanding indebtedness. The Group generally does not occupy the premises repossessed for its business use.

(vi) Credit risk exposure analysed by industry analysis for the financial assets are set out below:
The Group
Short-term
funds and
placements Undrawn Guarantees,
with banks Financial Loans, Clients’ Credit related loan endorsements
and other Financial Financial investments advances and Derivative Total commitments commitments and other
financial assets investments at amortised and brokers' Other financial credit risk and and other contingent
institutions at FVTPL at FVOCI cost financing balances receivables instruments exposures contingencies facilities items
2023 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Agriculture - 56,049 41,232 - 2,787,470 - - - 2,884,751 - 1,266,113 491
Mining and quarrying - - - - 120,761 - - - 120,761 - 89,612 -
Manufacturing - 14,136 - - 15,342,174 - - - 15,356,310 - 9,720,440 411,096
Electricity, gas and water - 1,773,889 2,490,005 5,024 738,051 - - - 5,006,969 - 306,418 6,651
Construction - 427,183 374,187 158,951 6,358,806 - 846 - 7,319,973 1,000 4,025,838 187,063
Wholesale and retail - - 33,156 16,176,215 - 1 - 16,209,372 - 7,911,734 223,573
Transport, storage and communications - 269,685 361,003 5,706,490 - - - 6,337,178 - 1,118,925 2,643
Finance, insurance, real estate and

business services 5,013,137 13,178,812 13,739,141 2,074,867 16,558,914 478,348 2,407,926 2,235,614 55,686,759 - 2,995,420 159,543
Government and government agencies 4,396,228 7,663,881 18,550,622 30,093,460 - - 2,155 - 60,706,346 - - 50,857
Education, health and others - - - - 1,538,040 - 80 - 1,538,120 - 393,439 -
Household - 21,460 - - 114,611,927 - - - 114,633,387 - 22,603,337 2,960
Purchase of securities - - - - 303,705 140,476 - - 444,181 917,463 - -
Others - - 37,789 - 324,862 - 41,503 - 404,154 - 1,783 -
9,409,365 23,405,095 35,627,135 32,332,302 180,567,415 618,824 2,452,511 2,235,614 286,648,261 918,463 50,433,059 1,044,877
282 • FINANCIALS

(vi) Credit risk exposure analysed by industry analysis for the financial assets are set out below: (continued)
The Group
Short-term
funds and
placements Guarantees,
with banks Financial Loans, Clients’ Credit related Undrawn loan endorsements
and other Financial Financial investments advances and Derivative Total commitments commitments and other
financial assets investments at amortised and brokers' Other financial credit risk and and other contingent
institutions at FVTPL at FVOCI cost financing balances receivables instruments exposures contingencies facilities items
2022 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Agriculture - 77,534 41,252 - 3,184,597 - - - 3,303,383 - 1,104,840 6,625

Mining and quarrying - - - - 131,719 - - - 131,719 - 77,169 -
Manufacturing - - - - 14,120,195 - - - 14,120,195 - 7,817,397 315,298
Electricity, gas and water - 1,600,466 1,980,042 431,237 720,058 - 30 - 4,731,833 - 246,455 10,224
Construction - 372,397 324,038 160,904 4,954,202 - 1,133 - 5,812,674 1,000 3,507,501 30,853
Wholesale and retail - - 31,847 - 15,666,440 - - - 15,698,287 - 7,003,440 251,317
Transport, storage and communications - 245,225 262,386 - 5,271,899 - 499 - 5,780,009 - 1,390,757 2,406
Finance, insurance, real estate and
business services 7,678,739 12,781,549 9,500,839 1,161,324 14,148,360 405,905 2,174,990 1,902,169 49,753,875 - 3,199,487 72,841
Government and government agencies 1,852,147 6,442,075 15,156,543 31,855,391 - - 1,553 - 55,287,709 - - 46,795
Education, health and others - - - - 1,714,066 - - - 1,714,066 - 524,211 3,843
Household - 19,559 - - 106,595,832 - - - 106,615,391 - 23,669,416 3,004
Purchase of securities - - - 329,172 316,276 - - 645,448 919,747 - -
Others - - 72,610 - 340,763 - 35,968 - 449,341 7,140 2,158 1,224
9,530,886 21,518,805 27,369,557 33,608,856 167,177,303 722,181 2,214,173 1,902,169 264,043,930 927,887 48,542,831 744,430

(vi) Credit risk exposure analysed by industry analysis for the financial assets are set out below: (continued)
The Company
Short-term
funds and
placements
with banks
and other Amount Total
financial Other due from credit risk
institutions receivables subsidiaries exposures
RM’000 RM’000 RM’000 RM’000
2023
Finance, insurance, real estate and business
services 133,106 1,996 - 135,102
2022
Finance, insurance, real estate and business
services 29,969 1,271 - 31,240
(vii) Write-off policy
The Group write off financial assets, in whole or in part, when it has exhausted all practical recovery efforts and
has concluded there is no reasonable expectation of recovery. Indicators that there is no reasonable expectation
of recovery include (i) ceasing enforcement activity and (ii) where the Group’s recovery method is foreclosing on
collateral and the value of the collateral is such that there is no reasonable expectation of recovering in full.
A write-off constitutes a derecognition event. The Group may apply enforcement activities to financial assets written
off. Recoveries resulting from the Group’s enforcement activities will be written back as bad debts recovered in the
income statements.
The contractual amount outstanding on loans, advances and financing and securities portfolio that were written off
during the financial year ended and are still subject to enforcement activities was RM388.4 million (2022: RM418.9
million) for the Group.
(viii) Modification of contractual cash flows
Where the original contractual terms of a financial asset have been modified for credit reasons and the instrument
has not been derecognised, the resulting modification loss is recognised within impairment in the income statements
with a corresponding decrease in the gross carrying value of the asset. If the modification involved a concession
that the Group would not otherwise consider, the instrument is considered to be credit impaired and is considered
forborne.
284 • FINANCIALS

(viii) Modification of contractual cash flows (continued)
ECL for modified financial assets that have not been derecognised and are not considered to be credit-impaired will
be recognised on a 12-month basis, or a lifetime basis, if there is a significant increase in credit risk. These assets are
assessed to determine whether there has been a significant increase in credit risk subsequent to the modification.
Although loans and financing may be modified for non-credit reasons, a significant increase in credit risk may occur.
The Group may determine that the credit risk has significantly improved after restructuring, so that the assets are
moved from stage 3 or stage 2 to stage 1. This is only the case for assets which have been monitored for consecutive
six months observation period or more.
The amounts of loans, advances and financing whose cash flows are modified and of which modification loss is
recognised during the year for the Group are Nil (2022: RM3,546.8 million).
(ix) Sensitivity analysis
The Group have performed ECL sensitivity assessment on loans, advances and financing based on the changes in key
macroeconomic variables, such as consumer price index, private consumption, house price index, unemployment
rates and banking system credit while all other variables remain unchanged. The sensitivity factors used are
assumptions based on parallel shifts in the key variables to project the impact on the ECL of the Group.
The table below outlines the effect of ECL on the changes in key variables used while other variables remain
constant:
(a) Retail
The Group
Changes
2023 2022
Private consumption +/- 100 bps +/- 100 bps

House price index +/- 100 bps +/- 100 bps
Unemployment rate +/- 200 bps +/- 200 bps
The Group
2023 2022
RM’000 RM’000
Total effect of ECL on the positive changes in key variables (3,793) (4,561)
Total effect of ECL on the negative changes in key variables 229 566

(ix) Sensitivity analysis (continued)
(b) Non-retail
The Group
Changes
2023 2022
Banking system credit +/- 100 bps +/- 100 bps
Gross domestic product +/- 100 bps +/- 100 bps
The Group
2023 2022
RM’000 RM’000
Total effect of ECL on the positive changes in key variables (4,263) (5,510)
Total effect of ECL on the negative changes in key variables 3,784 3,445
(iix) Overlays and adjustments for expected credit losses
As the current MFRS 9 models are not expected to generate levels of ECL with sufficient reliability in view of
the unprecedented and on-going COVID-19 pandemic, overlays and post-model adjustments have been applied to
determine a sufficient overall level of ECL for the year ended and as at 30 June 2023.
These overlays and post-model adjustments were taken to reflect the latest macroeconomic outlook not captured in
the modelled outcome and the potential impact to delinquencies and defaults when the various relief and support
measures are expire in the future.
The overlays and post-model adjustments involved significant level of judgement and reflect the management's
views of possible severities of the pandemic and paths of recovery in the forward looking assessment for ECL
estimation purposes.
The adjusted downside scenario has taken into consideration the current operating environment, which includes
downside risks from geopolitical conflicts, cost pressures, global monetary tightening and China’s pre-opening/
slowdown. As at 30 June 2023, the impact of these overlays and postmodel adjustments continues to remain
outside the MFRS 9 ECL Model. The ECL overlays amounted to RM574.2 million (2022: RM628.5 million) at the Group.
286 • FINANCIALS

52 FAIR VALUE OF FINANCIAL INSTRUMENTS
Financial instruments comprise financial assets and financial liabilities. Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The
information presented herein represents the estimates of fair values as at the statement of financial position date.
Where available, quoted and observable market prices are used as the measure of fair values. Where such quoted and observable
market prices are not available, fair values are estimated based on a range of methodologies and assumptions regarding risk
characteristics of various financial instruments, discount rates, estimates of future cash flows and other factors. Changes in the
uncertainties and assumptions could materially affect these estimates and the resulting fair value estimates.
(a) Determination of fair value and fair value hierarchy
The Group and the Company measure fair values using the following fair value hierarchy that reflects the significance of
the inputs used in making the measurements:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in
which inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly.
Level 3: Valuations derived from valuation techniques in which one or more significant inputs are not based on observable
market data.
Valuation techniques
Financial instruments are classified as Level 1 if their value is observable in an active market. Such instruments are valued
by reference to unadjusted quoted prices for identical assets or liabilities in active markets where the quoted prices is
readily available, and the price represents actual and regularly occurring market transactions. An active market is one in
which transactions occur with sufficient volume and frequency to provide pricing information on an on-going basis. These
would include actively traded listed equities and actively exchange-traded derivatives.
Where fair value is determined using unquoted market prices in less active markets or quoted prices for similar assets and
liabilities, such instrument are generally classified as Level 2. In cases where quoted prices are generally not available,
the Group then determines fair value based upon valuation techniques that use as inputs, market parameters including
but not limited to yield curves, volatilities and foreign exchange rates. The majority of valuation techniques employ only
observable market data and so reliability of the fair value measurement is high. These would include certain corporate
bonds, government bonds and derivatives.
Financial instruments are classified as Level 3 if their valuation incorporates significant inputs that are not based on
observable market data (unobservable inputs). Such inputs are generally determined based on observable inputs of a
similar nature, historical observations on the level of the input or other analytical techniques. This category includes
unquoted shares held for socio-economic reasons. Fair value for shares held for socio-economic reasons are based on the
net tangible assets of the affected companies.

52 FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
(a) Determination of fair value and fair value hierarchy (continued)
The table below analyses financial instruments carried at fair value analysed by level within the fair value hierarchy:
Fair Value
The Group Level 1 Level 2 Level 3 Total
2023 RM’000 RM’000 RM’000 RM’000
Recurring fair value measurements

Financial assets
Financial assets at FVTPL
- Money market instruments - 16,937,097 - 16,937,097
- Quoted securities 6,464,089 - - 6,464,089
- Unquoted securities - 8,099,336 393,370 8,492,706
Financial investments at FVOCI
Derivative financial instruments 26,174 2,135,086 74,354 2,235,614
10,927,114 58,361,803 565,374 69,854,291
Derivative financial instruments 874 2,374,718 71,839 2,447,431
Financial liabilities designated at fair value
- Structured deposits linked to interest rate
derivatives - 3,564,330 - 3,564,330
874 5,939,048 71,839 6,011,761
288 • FINANCIALS

The table below analyses financial instruments carried at fair value analysed by level within the fair value hierarchy:
(continued)
Fair Value
The Group Level 1 Level 2 Level 3 Total
2022 RM’000 RM’000 RM’000 RM’000
Recurring fair value measurements

Financial assets
Financial assets at FVTPL
Financial investments at FVOCI
Derivative financial instruments 9,909 1,787,458 104,802 1,902,169
10,126,915 48,127,975 570,851 58,825,741
Derivative financial instruments 104 1,661,392 103,510 1,765,006
Financial liabilities designated at fair value
- Structured deposits linked to interest rate
derivatives - 2,065,393 - 2,065,393
104 3,726,785 103,510 3,830,399
The Group recognise transfers between levels of the fair value hierarchy at the end of the reporting period during which
the transfer has occurred. The fair value of an asset to be transferred between levels is determined as of the date of the
event or change in circumstances that caused the transfer. There were no transfers between Level 1 and Level 2 of the fair
value hierarchy during the financial year (2022: RM Nil).

Reconciliation of fair value measurements in Level 3 of the fair value hierarchy, as below:
The Group
Financial
Financial Assets Liability
Financial Financial Derivative Derivative
assets at investments financial financial
FVTPL at FVOCI instruments instruments
RM’000 RM’000 RM’000 RM’000
2023
As at 1 July 382,663 83,386 104,802 103,510
Fair value changes recognised in statements of income 10,707 - 18,418 18,418
Net fair value changes recognised in other
comprehensive income - 14,264 - -
Purchases - - 57,400 56,257
Disposal - - - -
Settlements - - (106,266) (106,346)
As at 30 June 393,370 97,650 74,354 71,839
Fair value changes recognised in statements of income
relating to assets/liability held on 30 June 2023 10,707 - 18,418 18,418
Total gain recognised in other comprehensive income
relating to assets held on 30 June 2023 - 14,264 - -
2022
As at 1 July 374,729 69,094 76,913 76,913
Fair value changes recognised in statements of income 7,934 - 28,076 28,076
Net fair value changes recognised in other
comprehensive income - 14,292 - -
Purchases - - 2,155 863
Disposal - - - -
Settlements - - (2,342) (2,342)
As at 30 June 382,663 83,386 104,802 103,510
Fair value changes recognised in statements of income
relating to assets/liability held on 30 June 2022 7,934 - 28,076 28,076
Total gain recognised in other comprehensive income
relating to assets held on 30 June 2022 - 14,292 - -
290 • FINANCIALS

Quantitative information about fair value measurements using significant unobservable inputs (Level 3)
The Group
Inter-relationship between
Fair value Fair value Range significant unobservable
2023 assets liabilities Valuation Unobservable (weighted inputs and fair value
Description RM’000 RM’000 technique(s) input average) measurement
Financial assets at
FVTPL
Unquoted shares 393,370 - Net tangible Net tangible Not Higher net tangible assets
assets assets applicable results in higher fair value
Financial investments
at FVOCI
Derivative financial
instruments
Equity derivatives 74,354 (71,839) Monte Carlo Equity 6% Higher volatility, would
Simulation volatility to 47% generally result in higher fair
valuation for long volatility
positions and vice versa
Monte Carlo Equity/FX -30% An increase in correlation,
Simulation Correlation to -13% would generally result
between in a higher fair value
underlyers measurement and vice versa

Quantitative information about fair value measurements using significant unobservable inputs (Level 3) (continued)
The Group
Inter-relationship between
Fair value Fair value Range significant unobservable
2022 assets liabilities Valuation Unobservable (weighted inputs and fair value
Description RM’000 RM’000 technique(s) input average) measurement
Financial assets at
FVTPL
Financial investments
at FVOCI
instruments
Equity derivatives 104,802 (103,510) Monte Carlo Equity 7% Higher volatility, would
Simulation volatility to 121% generally result in higher fair
valuation for long volatility
positions and vice versa
Monte Carlo Equity/FX -16% An increase in correlation,
Simulation Correlation to 16% would generally result
between in a higher fair value
underlyers measurement and vice versa
292 • FINANCIALS

Sensitivity analysis for level 3
The Group
Effect of reasonable possible
alternative assumptions to:
Sensitivity Favourable/Unfavourable changes
Type of of significant Financial Financial
unobservable unobservable assets liabilities
input input RM’000 RM’000
2023
- Equity derivatives Equity volatility +10% (22) 22
-10% 19 (19)
Equity/FX +10% (1) 1

Correlation -10% (181) 181
Total* (185) 185
2022
- Equity derivatives Equity volatility +10% 271 (271)
-10% (355) 355
Equity/FX +10% 35 (35)

Correlation -10% 121 (121)
Total* 72 (72)
* No or insignificant impact to the Group. All equity link derivatives with unobservable inputs are hedged back-to-back
with external parties.

(b) Fair values of financial instruments not carried at fair value
Set out below is the comparison of the carrying amount and fair value of those financial instruments of the Group and the
Company which are not carried at fair value in the financial instruments, but for which fair value is disclosed. It does not
include those short term/on demand financial assets and financial liabilities where the carrying amount are reasonable
approximation of their fair values:
The Group
Carrying Carrying
amount Fair value amount Fair value
2023 2023 2022 2022
RM’000 RM’000 RM’000 RM’000
Financial assets
Financial investments at amortised cost
- Money market instruments 31,666,461 32,296,492 29,626,784 29,951,834
- Quoted securities 19,117 18,668 62,174 61,526
- Unquoted securities 646,725 654,508 3,919,899 3,925,377
Loans, advances and financing 180,567,415 181,451,666 167,177,303 168,100,543
212,899,718 214,421,334 200,786,160 202,039,280
Deposits from customers 207,903,113 208,171,116 195,317,528 195,073,675
Recourse obligations on loans sold to Cagamas Berhad 2,972,220 2,976,763 1,623,936 1,808,376
Borrowings 201,936 196,761 411,931 403,565
Subordinated obligations 2,206,650 2,211,139 2,207,083 2,199,738
Multi-currency Additional Tier 1 capital securities 1,719,630 1,711,610 1,715,849 1,719,554
215,003,549 215,267,389 201,276,327 201,204,908
The Company
Carrying Carrying
amount Fair value amount Fair value
2023 2023 2022 2022
RM’000 RM’000 RM’000 RM’000
Borrowings 201,919 196,744 411,858 403,492
Subordinated obligations 1,101,859 1,103,527 1,601,624 1,588,675
Multi-currency Additional Tier 1 capital securities 404,851 403,341 806,431 806,898
1,708,629 1,703,612 2,819,913 2,799,065
294 • FINANCIALS

(b) Fair values of financial instruments not carried at fair value (continued)
The following table analyses within the fair value hierarchy of the Group’s and the Company’s assets and liabilities not
measured at fair value but for which fair value is disclosed:
Carrying Fair value

amount Level 1 Level 2 Level 3
2023
Financial assets
- Money market instruments 31,666,461 - 32,296,492 -
- Quoted securities 19,117 - 18,668 -
- Unquoted securities 646,725 - 654,508 -
Loans, advances and financing 180,567,415 - 181,451,666 -
212,899,718 - 214,421,334 -
Deposits from customers 207,903,113 - 208,171,116 -
Recourse obligations on loans sold to Cagamas Berhad 2,972,220 - 2,976,763 -
Borrowings 201,936 - 196,761 -
Subordinated obligations 2,206,650 - 2,211,139 -
Multi-currency Additional Tier 1 capital securities 1,719,630 - 1,711,610 -
215,003,549 - 215,267,389 -
2022
Financial assets
- Money market instruments 29,626,852 - 29,951,834 -
- Quoted securities 62,174 - 61,526 -
- Unquoted securities 3,919,899 - 3,925,377 -
Loans, advances and financing 167,177,303 - 168,100,543 -
200,786,228 - 202,039,280 -
Deposits from customers 195,317,528 - 195,073,675 -
Recourse obligations on loans sold to Cagamas Berhad 1,623,936 - 1,808,376 -
Borrowings 411,931 - 403,565 -
Multi-currency Additional Tier 1 capital securities 1,715,849 - 1,719,555 -
201,276,327 - 201,204,909 -

(b) Fair values of financial instruments not carried at fair value (continued)
The following table analyses within the fair value hierarchy of the Group’s and the Company’s assets and liabilities not
measured at fair value but for which fair value is disclosed: (continued)
Carrying Fair value

amount Level 1 Level 2 Level 3
2023
Borrowings 201,919 - 196,744 -
Multi-currency Additional Tier 1 capital securities 404,851 - 403,341 -
1,708,629 - 1,703,612 -
2022
Borrowings 411,858 - 403,492 -
Multi-currency Additional Tier 1 capital securities 806,431 - 806,898 -
2,819,913 - 2,799,065 -
(c) Fair value methodologies and assumptions
Short-term funds and placements with financial institutions
For short-term funds and placements with financial institutions with maturities of less than six months, the carrying
value is a reasonable estimate of fair value. For short-term funds and placements with maturities six months and above,
estimated fair value is based on discounted cash flows using prevailing money market interest rates at which similar
deposits and placements would be made with financial institutions of similar credit risk and remaining period to maturity.
Securities purchased under resale agreements
The fair values of securities purchased under resale agreements with maturities of less than six months approximate the
carrying values. For securities purchased under resale agreements with maturities of six months and above, the estimated
fair values are based on discounted cash flows using market rates for the remaining term to maturity.
FVTPL, FVOCI and financial investments at amortised cost
The estimated fair value is generally based on quoted and observable market prices. Where there is no ready market in
certain securities, the Group and the Company establishes the fair value by using valuation techniques.
296 • FINANCIALS

(c) Fair value methodologies and assumptions (continued)
For floating rate loans, the carrying value is generally a reasonable estimate of fair value. For fixed rate loans, the fair value
is estimated by discounting the estimated future cash flows using the prevailing market rates of loans with similar credit
risks and maturities.
Deposits from customers
For deposits from customers with maturities of less than six months, the carrying amounts are reasonable estimates of
their fair values. For deposit with maturities of six months and above, fair values are estimated using discounted cash
flows based on prevailing market rates for similar deposits from customers.
Deposits and placements of banks and other financial institutions, bills and acceptances payable
The estimated fair values of deposits and placements of banks and other financial institutions and bills and acceptances
payable with maturities of less than six months approximate the carrying values. For the items with maturities six months
and above, the fair values are estimated based on discounted cash flows using prevailing money market interest rates
with similar remaining period to maturities.
Recourse obligations on loans sold to Cagamas Berhad
For amounts due to Cagamas Berhad with maturities of less than one year, the carrying amounts are a reasonable estimate
of their fair values. For amounts due to Cagamas Berhad with maturities of more than one year, fair value is estimated
based on discounted cash flows using prevailing money market interest rates with similar remaining period to maturity.
Subordinated obligations, senior notes and capital securities
The fair value of subordinated obligations, senior notes and capital securities are based on quoted market prices where
available.
Other financial assets and liabilities
The carrying value less any estimated allowance for financial assets and liabilities included in “other assets and liabilities”
are assumed to approximate their fair values as these items are not materially sensitive to the shift in market interest
rates.
Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at
amortised cost; any difference between initial recognised amount and the redemption amount is recognised in profit or
loss over the period of the borrowings using the effective interest method.
All other borrowing costs are recognised in statements of income in the period in which they are incurred.

(c) Fair value methodologies and assumptions (continued)
Credit related commitment and contingencies
The net fair value of these items was not calculated as estimated fair values are not readily ascertainable. These financial
instruments generally relate to credit risks and attract fees in line with market prices for similar arrangements. They are
not presently sold nor traded. The fair value may be represented by the present value of fees expected to be received, less
associated costs.
Foreign exchange and interest rate related contracts
The fair values of foreign exchange and interest rate related contracts are the estimated amounts the Group or the
Company would receive or pay to transfer the contracts at the statements of financial position date.
53 OFFSETTING OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES
Financial assets and financial liabilities subject to offsetting, enforceable master netting arrangements and similar agreements
are as follows:
Related amount not set off in

the statements of financial
position
Gross amount Net amount
recognised Gross amount presented
in the offset in the in the Values Cash
statements of statements of statements of the collateral
financial financial of financial financial received/
The Group position position position instruments pledged Net amount
2023 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Financial assets
Clients’ and brokers’ balances 888,349 (269,525) 618,824 - - 618,824
instruments 2,235,614 - 2,235,614 (879,311) (97,281) 1,259,022
Total 3,123,963 (269,525) 2,854,438 (879,311) (97,281) 1,877,846
instruments 2,447,431 - 2,447,431 (879,311) (914,162) 653,958
Obligations on securities
sold under repurchase
agreements 7,399,583 - 7,399,583 (7,399,583) - -
Payables and other liabilities 12,193,314 (138,858) 12,054,456 - - 12,054,456
Total 22,316,388 (269,525) 22,046,863 (8,278,894) (914,162) 12,853,807
298 • FINANCIALS

53 OFFSETTING OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued)
Financial assets and financial liabilities subject to offsetting, enforceable master netting arrangements and similar agreements
are as follows: (continued)
Related amount not set off in

the statements of financial
position
Gross amount Net amount
recognised Gross amount presented
in the offset in the in the Values Cash
statements of statements of statements of the collateral
financial financial of financial financial received/
The Group position position position instruments pledged Net amount
2022 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Financial assets
instruments 1,902,169 - 1,902,169 (918,459) (164,363) 819,347
Total 2,837,779 (213,429) 2,624,350 (918,459) (164,363) 1,541,528
instruments 1,765,006 - 1,765,006 (918,459) (570,298) 276,249
Obligations on securities
sold under repurchase
agreements 3,971,304 - 3,971,304 (2,755,310) - 1,215,994
Payables and other liabilities 12,122,859 (121,845) 12,001,014 - - 12,001,014
Total 18,257,654 (213,429) 18,044,225 (3,673,769) (570,298) 13,800,158

54 EQUITY COMPENSATION BENEFITS
Executive Share Scheme
The Group established and implemented the following Executive Share Schemes.
(a) Executive Share Scheme 2013 (“ESS 2013”)
ESS 2013 established using the shares of the Company - The Company and its subsidiary company Hong Leong
Assurance Berhad
The ESS 2013 of up to ten percent (10%) of the total number of issued shares (excluding treasury shares) of the Company
comprises the Executive Share Option Scheme 2013/2023 (“ESOS 2013”) and the Executive Share Grant Scheme 2013
(“ESGS 2013”).
The ESS 2013 had expired on 11 March 2023.
The main features of the ESS 2013 are, inter alia, as follows:
1. Eligible executives are persons as defined by the ESS 2013 Bye-Laws.
2. The maximum allowable allotments for the full time Executive Directors had been approved by the shareholders of
the Company in a general meeting. The Board, as defined by the ESS 2013 Bye-Laws, may from time to time at its
absolute discretion select and identify suitable eligible executives to be offered options or grants.
3. At any point of time during the existence of the ESS 2013, the aggregate number of shares comprised in the options
and grants under the ESS 2013 and any other executive share schemes established by the Company which are still
subsisting shall not exceed 10% of the total number of issued shares (excluding treasury shares) of the Company at
any one time.
4. The option price for the options to be granted under the ESOS 2013 shall not be at a discount of more than ten
percent (10%) (or such discount as the relevant authorities shall permit) from the 5-day volume weighted average
market price of the shares of the Company preceding the Date of Offer as defined by the ESS 2013 Bye-Laws.
5. The options granted to an option holder under the ESOS 2013 is exercisable by the option holder during his
employment or directorship with the Group and upon meeting the vesting conditions of each ESOS 2013 plan subject
to any maximum limit as may be determined by the Board under the ESS 2013 Bye-Laws.
6. The shares to be vested to a grant holder under the ESGS 2013 will be vested to the grant holder only during his
employment or directorship with the Group and subject to any other terms and conditions as may be determined by
the Board.
7. The exercise of the options under the ESOS 2013 or the vesting of shares under the ESGS 2013 may, at the absolute
discretion of the Board, be satisfied by way of issuance of new shares; transfer of existing shares purchased by a
trust established for the ESS 2013; or a combination of both new shares and existing shares.
300 • FINANCIALS

54 EQUITY COMPENSATION BENEFITS (continued)
Executive Share Scheme (continued)
(a) Executive Share Scheme 2013 (“ESS 2013”) (continued)
Assurance Berhad (continued)
The ESOS 2013 options granted have performance and/or service based vesting conditions. Generally, the share options
granted can be classified into 2 categories:
- An award that is conditional upon achieving agreed key performance indicators and milestones; and/or
- An award for the recognition of material and positive accomplishments towards building a strong and sustainable
underlying business value, preserving and enhancing the quality of assets and for shareholders wealth creation.
(i) ESOS 2013
The ESOS 2013 which was approved by the shareholders of the Company on 30 October 2012, was established on
12 March 2013 and had expired on 11 March 2023.
On 18 September 2012, the Company announced that Bursa Malaysia Securities Berhad had resolved to approve the
listing of new ordinary shares of the Company to be issued pursuant to the exercise of options under the ESOS 2013.
The ESOS 2013 would provide an opportunity for eligible executives who had contributed to the growth and
development of the Group to participate in the equity of the Company.
Arising from the completion of the Company’s Rights Issue on 7 December 2015, the exercise price for the share
options granted on 2 April 2015 under the ESS 2013 was adjusted from RM16.88 to RM16.61 and additional share
options of 189,819 were allotted to the option holders, in accordance with the provisions of the ESS 2013 Bye-Laws.
(ii) ESGS 2013
The ESGS 2013 which was approved by the shareholders of the Company on 29 October 2013, was established on
28 February 2014 and would end on 11 March 2023.
On 6 September 2013, the Company announced that Bursa Malaysia Securities Berhad had resolved to approve-in-
principle the listing of new ordinary shares of the Company to be issued pursuant to the ESGS 2013.
The ESGS 2013 would provide the Company with the flexibility to reward the eligible executives of the Group for their
contribution with awards of the Company’s shares without any consideration payable by the eligible executives.
The unvested grant shares consisting of 156,402 ordinary shares granted under ESGS 2013 had been transferred to
the new ESS 2022 due to the expiry of the ESS 2013 during the financial year.

(b) Executive Share Scheme 2022 (“ESS 2022”)
In light of the expiry of the EES 2013 on 11 March 2023, the company had on 28 Aprill 2022 established in the ESS 2022,
which comprise a new executive share option scheme (“ESOS 2022”) and a new executive share grants scheme (“ESGS
2022”) for the eligible executives and/or directiors of the Group (such executives and directors.”Eligible Executives”). The
ESS 2022 shall be in force until terminted by the Board of Directors of the Company.
Assurance Berhad
The ESS 2022, which is governed by the ESS 2022 Bye-Laws, entails the making of one or more of the following offers to
the Eligible Executives:
(i) option(s) under the executive share option scheme (“ESOS 2022”) which entitle an Eligible Executive who has
accepted the offer (“Option Holder(s)”) to acquire ordinary shares in HLFG (“Shares”) at an exercise price to be
determined by the Board at its discretion (“Option Price”) (“Option(s)”); and/or
(ii) grant(s) under the executive share grant scheme (“ESGS 2022”) which entitle an Eligible Executive who has accepted
the offer (“Grant Holder(s)”) to receive Shares without any consideration payable by the Grant Holder (“Grant(s)”).
(The Option Holder(s) and Grant Holder(s) are collectively referred to as the “Holder(s)”.)
The Board may at its discretion impose such vesting conditions (including financial and performance targets, the
performance period and vesting period, if any) as it deems fit with the offer of the Options and/or Grants (“Offer(s)”). In
determining whether to make an Option Offer and/or a Grant Offer, the Board may take into consideration various factors
such as market practice, the quantum of the award, the length of the performance period and the performance targets.
In implementing the ESS 2022, it is the intention of the Company to have the flexibility, at the absolute discretion of the
Board, to enable the satisfaction of the Options and/or Grants through the following:
(i) transfer of existing Shares (other than treasury Shares); and/or
(ii) cash settlement pursuant to the Bye-Laws.

302 • FINANCIALS

A trust has been set up for the Executive Share Scheme and it is administered by an appointed trustee. This trustee will be
entitled from time to time to accept financial assistance from the Group upon such terms and conditions as the Group and the
trustee may agree to purchase the Company’s shares from the open market for the purposes of this trust. In accordance with
MFRS 132, the shares purchased for the benefit of the Executive Share Scheme holdings are recorded as “Treasury Shares for ESS”
in the shareholders’ equity on the statements of financial position. The cost of operating the Executive Share Scheme is charged
to the statements of income.
The number and cost of the ordinary shares held by the Trustee are as follows:
The Group
2023 2022
Number Number
of trust of trust
shares held Cost shares held Cost
unit’000 RM’000 unit’000 RM’000
As at 1 July 13,572 236,039 13,728 238,970

Purchase of treasury shares - - - -
Exercise of grant shares (157) (2,931) (156) (2,931)
As at 30 June 13,415 233,108 13,572 236,039
The Company
2023 2022
Number Number
of trust of trust
shares held Cost shares held Cost
unit’000 RM’000 unit’000 RM’000
As at 1 July 9,480 177,656 9,636 180,587

Exercise of grant shares (157) (2,931) (156) (2,931)
As at 30 June 9,323 174,725 9,480 177,656

Executive Share Scheme (“ESS”) established using the shares of the Company - The Company and its subsidiary company
Hong Leong Assurance Berhad (continued)
ESOS
The options granted under the scheme are as follows:
The Group
Outstanding Exercisable
As at Option Ceased/ as at as at
1 July granted Exercised Forfeited 30 June 30 June
Grant date unit’000 unit’000 unit’000 unit’000 unit’000 unit’000
2023
15-Dec-17 - - - - - -
2022
15-Dec-17 12,425 - - (12,425) - -
The Company
2023
15-Dec-17 - - - - - -
2022
15-Dec-17 7,000 - - (7,000) - -
Adjustments on exercise price due to Rights Issue
The fair value of share options granted was estimated using the Black-scholes model, taking into account the terms and
conditions upon which the options are granted and is inclusive of incremental fair value arising from adjusted exercise price. The
expected volatility reflects the assumption that the historical volatility was indicative of future trends, which may not necessarily
be the actual outcome.
304 • FINANCIALS

Executive Share Scheme (“ESS”) established using the shares of the Company - The Company and its subsidiary company
Hong Leong Assurance Berhad (continued)
ESGS
The ordinary shares granted under the scheme are as follows:
The Group
2023
3-Nov-21 313 - (157) - 156 -
2022
3-Nov-21 - 469 (156) - 313 -
The Company
2023
3-Nov-21 313 - (157) - 156 -
2022
3-Nov-21 - 469 (156) - 313 -

Executive Share Scheme (“ESS”) established using the shares of subsidiary of the Company - Hong Leong Bank Berhad
(“HLB”)
There are two share issuance schemes implemented by the HLB.
(a) Executive Share Scheme 2013 (“ESS 2013”)
The ESS 2013 of up to ten percent (10%) of the issued and paid-up ordinary share capital (excluding treasury shares) of
HLB comprisesthe Executive Share Option Scheme 2013 (“ESOS 2013”) and the Executive Share Grant Scheme 2013 (“ESGS
2013”).
The main features of the ESS 2013 are, inter alia, as follows:
1. Eligible executives are persons as defined by the ESS 2013 Bye-Laws.
2. The maximum allowable allotments for the full time Executive Directors had been approved by the shareholders
of HLB in the annual general meeting held on 23 October 2013 and 25 October 2012. The Board of HLB, as defined
by the ESS 2013 Bye-Laws, may from time to time at its absolute discretion select and identify suitable eligible
executives to be offered options or grants.
3. At any point of time during the existence of the ESS 2013, the aggregate number of shares comprised in the options
and grants under the ESS 2013 and any other executive share schemes established by HLB which are still subsisting
shall not exceed 10% of the issued and paid-up ordinary share capital (excluding treasury shares) of HLB at any one
time.
4. The exercise of the options under the ESOS 2013 or the vesting of shares under the ESGS 2013 may, at the absolute
discretion of the HLB’s Board, be satisfied by way of issuance of new shares; transfer of existing shares purchased by
a trust established for the ESS; or a combination of both new shares and existing shares.
(i) ESOS 2013
The ESOS 2013 which was approved by the shareholders of HLB on 25 October 2012, was established on 12 March
2013 and would be in force for a period of ten (10) years.
On 18 September 2012, HLB announced that Bursa Malaysia Securities Berhad had resolved to approve the listing of
new ordinary shares of HLB to be issued pursuant to the exercise of options under the ESOS 2013.
The ESOS 2013 would provide an opportunity for eligible executives who had contributed to the growth and
development of the HLB Group to participate in the equity of HLB.
306 • FINANCIALS

(“HLB”) (continued)
(i) ESOS 2013 (continued)
The main features of the ESOS 2013 are, inter alia, as follows:
1. The option price for the options to be granted under the ESOS 2013 shall not be at a discount of more than
ten percent (10%) (or such discount as the relevant authorities shall permit) from the 5-day weighted average
market price of the shares of HLB preceding the Date of Offer as defined by the ESS Bye-Laws, and shall in no
event be less than the par value of the shares of HLB.
2. The options granted to an option holder under the ESOS 2013 is exercisable by the option holder during his
employment or directorship with the HLB Group and upon meeting the vesting conditions of each ESOS 2013
plan subject to any maximum limit as may be determined by the HLB’s Board under the Bye-Laws of the
ESS.
During the financial year, Nil (2022: Nil) share options have been granted under the ESOS 2013 with Nil (2022:
Nil) options remain outstanding.
(ii) ESGS 2013
The ESGS 2013 which was approved by the shareholders of HLB on 23 October 2013, was established on 28 February
2014 and would end on 11 March 2023.
On 10 September 2013, HLB announced that Bursa Malaysia Securities Berhad had resolved to approve in principle
the listing of new ordinary shares of HLB to be issued pursuant to the ESGS 2013.
The ESGS 2013 would provide HLB with the flexibility to reward the eligible executives of the HLB Group for their
contribution with awards of HLB’s shares without any consideration payable by the eligible executives.
The shares to be vested to a grant holder under the ESGS 2013 will be vested to the grant holder only during his
employment or directorship with the HLB Group and subject to any other terms and conditions as may be determined
by the HLB’s Board.
During the financial year ended 30 June 2023, total of 543,079 ordinary shares were vested and transferred pursuant
to the HLB’s ESGS, 106 ordinary shares forfeited with 430,786 ordinary shares remain outstanding.
The unvested grant shares consisting of 430,785 ordinary shares granted under ESGS 2013 had been transferred to
the new ESS 2022 due to the expiry of the ESS 2013 during the financial year.

(“HLB”) (continued)
(b) ESS 2022
The ESS 2022, which is governed by the bye-laws (“Bye-Laws”), entails the making of one (1) or more of the following
offers to the Eligible Executives:
(1) option(s) under the ESOS which entitle an Eligible Executive who has accepted the offer (“Option Holder(s)”) to
acquire ordinary shares in HLB (“Shares”) at an exercise price to be determined by the board at its discretion (“Option
Price”) (“Option(s)”); and/or
(2) grant(s) under the ESGS which entitle an Eligible Executive who has accepted the offer (“Grant Holder(s)”) to receive
Shares without any consideration payable by the Grant Holder (“Grant(s)”).
The board may at its discretion impose such vesting conditions (including financial and performance targets, the
performance period and vesting period, if any) as it deems fit with the offer of the Options and/or Grants (“Offer(s)”). In
determining whether to make an Option Offer and/or a Grant Offer, the board may take into consideration various factors
such as market practice, the quantum of the award, the length of the performance period and the performance targets.
In implementing the ESS 2022, it is the intention of the HLB to have the flexibility, at the absolute discretion of the board,
to enable the satisfaction of the Options and/or Grants through the following:
(1) transfer of existing Shares (other than treasury Shares); and/or
(2) cash settlement pursuant to the Bye-Laws.
During the financial year ended 30 June 2023, a total of 125,445 ordinary shares were vested and transferred pursuant to
the Bank’s ESS 2022, 2,526 ordinary shares forfeited with 373,997 ordinary shares remain outstanding.
55 SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR
(a) On 10 November 2022, Hong Leong Capital Berhad (“HLCB”) announced that the liquidator of HLG Capital Markets Sdn Bhd
(“HLGCM”) had convened the final meeting to conclude the member’s voluntary winding-up of HLGCM. The Returns by
Liquidator Relating to Final Meeting of HLGCM were lodged with the Companies Commission of Malaysia and the Official
Receiver on 10 November 2022 (“Lodgement Date”), and on the expiration of 3 months after the Lodgement Date, HLGCM
was dissolved on 10 February 2023.
(b) On 17 January 2023, Hong Leong Bank Berhad announced that it had placed EB Nominees (Tempatan) Sendirian Berhad
(“EB Nominees (Tempatan)”), its wholly-owned subsidiary, under member’s voluntary winding-up pursuant to Section
439(1)(b) of the Companies Act 2016. EB Nominees (Tempatan) is currently dormant and there are no future plans to
activate the company.
(c) On 3 May 2023, HLCB announced that the liquidator of SSSB Jaya (1987) Sdn Bhd (“SSSB Jaya”), an indirect wholly-owned
subsidiary of HLCB, had convened the final meeting to conclude the creditors’ voluntary winding-up of SSSB Jaya. The
Returns by Liquidator Relating to Final Meeting of SSSB Jaya were lodged with the Companies Commission of Malaysia and
the Official Receiver on 3 May 2023 (“Lodgement Date”), and on the expiration of 3 months after the Lodgement Date,
SSSB Jaya was dissolved on 3 August 2023.
56 SUBSEQUENT EVENTS AFTER THE FINANCIAL YEAR
There are no material subsequent events after the financial year that require disclosure or adjustments to the financial statements.
308 • FINANCIALS

57 INCOME TAX RELATING TO COMPONENTS OF OTHER COMPREHENSIVE INCOME
The Group
Before Tax Net of tax
tax benefits amount
RM’000 RM’000 RM’000
2023
Financial investments at fair value through other comprehensive income
- net fair value changes and changes in expected credit losses 441,097 (93,068) 348,029
Cash flow hedge

- net fair value gain/(loss) 362 (83) 279
2022
Financial investments at fair value through other comprehensive income
- net fair value changes and changes in expected credit losses (1,178,201) 261,084 (917,117)
Cash flow hedge

- net fair value gain/(loss) 7,574 (1,816) 5,758
58 IBOR REFORM
Following the financial crisis, the reform and replacement of benchmark interest rates such as Kuala Lumpur Interbank Offered
Rate (“KLIBOR”), London Interbank Offered Rate denominated in USD (“USD LIBOR”) and other inter-bank offered rates (“IBORs”)
has become a priority for global regulators. There is currently uncertainty around the timing and precise nature of these changes.
The Group have designated hedge relationships where hedged items and/or hedging instruments has reference to IBORs.
The Group’s risk exposure that is directly affected by the IBOR reform through its fair value hedges predominantly comprises
exposures to KLIBOR and USD LIBOR. These fair value hedges are designated using interest rate swaps, for changes attributable
to the respective current benchmark interest rates, which are MYR KLIBOR, Secured Overnight Financing Rate (“SOFR”) and
Singapore Overnight Rate Average (“SORA”).
As part of the reforms noted above:
- In 2021, BNM introduced the Malaysia Overnight Rate (“MYOR”) as the new alternative reference rate, which will run
in parallel with the existing KLIBOR, providing the market with the flexibility to choose either MYOR or KLIBOR as the
reference rate for pricing of financial instruments. On 1 January 2023, BNM had discontinued the publication of the 2- and
12-month KLIBOR tenors, which are the least referenced rates in the market for financial contracts. The remaining one-,
three- and six-month KLIBOR tenors, which continue to reflect an active underlying market, continued to be published. The
Financial Markets Committee (“FMC”) will engage the International Swaps and Derivatives Association (“ISDA”) to ensure
continuity of KLIBOR derivative contracts in the event of a temporary or permanent discontinuation of KLIBOR publication.

58 IBOR REFORM (continued)
As part of the reforms noted above: (continued)
- The UK Financial Conduct Authority (“FCA”) has decided not to compel the panel banks to participate in the USD LIBOR
submission process after 31 December 2021 (for GBP, EUR, JPY, CHF LIBOR and USD LIBOR 1-week and 2-month tenors) and
after 30 June 2023 (the remaining US dollar settings).
- The Association of Banks in Singapore and the Singapore Foreign Exchange Market Committee have discontinued the
6- month SIBOR on 31 March 2022, while the 1-month and 3-month SIBOR will be discontinued after December 2024.
The SOFR is expected to replace the USD LIBOR, and regulatory authorities and private sector working groups, had published
recommendations to use USD SOFR compounded in arrears or USD Term SOFR, as alternatives to replace USD LIBOR for different
financial products.
The Group Asset and Liability Committee oversees the Group’s IBOR transition plan. The transition plan considers changes to
systems, processes, risk management and valuation models, as well as managing tax and accounting implications. The Group
and the Company continue to monitor market developments in relation to the transition and their impact on the Group’s financial
assets and liabilities to ensure that there are no unexpected consequences or disruptions from the transition.
The Group hold the following financial instruments which are referenced to the current benchmark interest rates and have yet
to transition to an alternative interest rate benchmark:
The Group Notional Amount

Assets Liabilities
2023 RM’000 RM’000
(a) Derivative assets/liabilities

(i) Interest rate swaps
- KLIBOR 58,884,165 62,589,844
(ii) Cross currency swaps
- USD LIBOR 1,590,860 2,346,479
(iii) Option
- KLIBOR 4,297,008 821,860
The Group Notional Amount

Assets Liabilities
2022 RM’000 RM’000
(a) Derivative assets/liabilities

(i) Interest rate swaps
- USD LIBOR 66,083 198,248
- KLIBOR 40,313,762 45,961,580
40,379,845 46,159,828
(ii) Cross currency swaps
- USD LIBOR 1,959,061 3,050,298
(iii) Option
- KLIBOR 2,458,510 100,000
310 • FINANCIALS

59 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS IN APPLYING ACCOUNTING POLICIES
The Group and the Company make estimates and assumptions concerning the future. The resulting accounting estimates will, by
definition, rarely equal the related actual results. To enhance the information content of the estimates, certain key variables that
are anticipated to have material impact to the Group’s and the Company’s results and financial position are tested for sensitivity
to changes in the underlying parameters. The estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amount of assets and liabilities within the next financial year are outlined below:
(a) Allowance for ECL
The measurement of the ECL for financial assets measured at amortised cost and FVOCI is an area that requires the use of
complex models and significant assumptions about future economic conditions and credit behaviour.
MFRS 9 introduces the use of macro economic factors which include, but is not limited to, unemployment, interest rates,
gross domestic product, private consumption, inflation and commercial property prices, and requires an evaluation of both
the current and forecast direction of the economic cycle. Incorporating forward looking information increases the level of
judgement as to how changes in these macroeconomic factors will affect ECL. The methodology and assumptions including
any forecasts of future economic conditions are reviewed regularly.
A number of significant judgements are also required in applying the accounting requirements for measuring ECL, such as:
(i) Determining criteria for significant increase in credit risk;

(ii) Choosing appropriate models and assumptions for the measurement of ECL;
(iiii) Establishing the number and relative weightings of forward-looking scenarios for each type of product/market and
the associated ECL; and
(iv) Establishing groups of similar financial assets for the purposes of measuring ECL.
The sensitivity effect on the macroeconomic factor is further disclosed in Note 51(d) to the financial statements.
(b) Life policyholders’ fund
Material judgement is required in determining the liabilities and in the choice of assumptions.
Assumptions in use are based on the past experience, current internal data, external market indices and benchmarks
which reflect current observable market prices and other published information.
Assumptions and prudent estimates are determined at the date of valuation and no credit is taken for possible beneficial
effects of voluntary withdrawals.
Assumption are further evaluated on a continuous basis in order to ensure realistic and reasonable valuations.
60 APPROVAL OF FINANCIAL STATEMENTS
The financial statements were authorised for issue by the Board of Directors of the Company in accordance with a resolution of
the Directors on 20 September 2023.
Statement by Directors
Pursuant to Section 251(2) of the Companies Act, 2016
We, Tan Kong Khoon and Ho Heng Chuan, being two of the Directors of Hong Leong Financial Group Berhad, do hereby state that, in
the opinion of the Directors, the accompanying financial statements set out on pages 120 to 310 are drawn up so as to give a true and
fair view of the financial position of the Group and of the Company as at 30 June 2023 and financial performance of the Group and the
Company for the year then ended 30 June 2023, in accordance with Malaysian Financial Reporting Standards, International Financial
Reporting Standards and the requirements of the Companies Act, 2016 in Malaysia.
On behalf of the Board.
TAN KONG KHOON HO HENG CHUAN

Director Director
Kuala Lumpur
20 September 2023
Statutory Declaration
Pursuant to Section 251(1) of the Companies Act, 2016
I, Teh Tiong Khim, the Officer primarily responsible for the financial management of Hong Leong Financial Group Berhad, do solemnly
and sincerely declare that the financial statements set out on pages 120 to 310 are to the best of my knowledge and belief correct
and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory
Declarations Act, 1960.
Subscribed and solemnly declared by )

the abovenamed Teh Tiong Khim at )
Kuala Lumpur in Wilayah Persekutuan on ) TEH TIONG KHIM
20 September 2023 ) MIA No. CA 13898
Before me,
Pesuruhjaya Sumpah
Commissioner for Oaths
312 • FINANCIALS
Independent Auditors’ Report

to the members of Hong Leong Financial Group Berhad
Registration No. 196801000439 (8024-W) (Incorporated in Malaysia)
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
Our opinion
In our opinion, the financial statements of Hong Leong Financial Group Berhad (“the Company”) and its subsidiaries (“the Group”) give
a true and fair view of the financial position of the Group and of the Company as at 30 June 2023, and of their financial performance
and their cash flows for the financial year then ended in accordance with Malaysian Financial Reporting Standards, International
Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia.
What we have audited
We have audited the financial statements of the Group and of the Company, which comprise the statements of financial position as at
30 June 2023 of the Group and of the Company, and the statements of income, statements of comprehensive income, statements of
changes in equity and statements of cash flows of the Group and of the Company for the financial year then ended, and notes to the
financial statements, including a summary of significant accounting policies, as set out on pages 120 to 310.
Basis for opinion
We conducted our audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing. Our
responsibilities under those standards are further described in the “Auditors’ responsibilities for the audit of the financial statements”
section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence and other ethical responsibilities
We are independent of the Group and of the Company in accordance with the By-Laws (on Professional Ethics, Conduct and Practice)
of the Malaysian Institute of Accountants (“By-Laws”) and the International Ethics Standards Board for Accountants’ International Code
of Ethics for Professional Accountants (including International Independence Standards) (“IESBA Code”), and we have fulfilled our other
ethical responsibilities in accordance with the By-Laws and the IESBA Code.
Our audit approach
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements
of the Group and of the Company. In particular, we considered where the Directors made subjective judgements; for example, in
respect of significant accounting estimates that involved making assumptions and considering future events that are inherently
uncertain. As in all of our audits, we also addressed the risk of management override of internal controls, including among other
matters, consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the financial statements
as a whole, taking into account the structure of the Group and of the Company, the accounting processes and controls, and the industry
in which the Group and the Company operate.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the Group and of the Company for the current financial year. These matters were addressed in the context of our audit
of the financial statements of the Group and of the Company as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (continued)
Key audit matter How our audit addressed the key audit matter
Impairment of loans, advances and financing for We understood and tested the design and operating effectiveness of the controls
the Group relating to:
Refer to Note O of the summary of significant • Identification of loans, advances and financing that displayed objective
accounting policies and Notes 7, 39 and 59 to evidence of impairment or loans, advances and financing that have experienced
the financial statements. significant increase in credit risk or objective evidence of impairment and the
calculation of the impairment loss;
We focused on this area due to the significant
size of the carrying value of loans, advances and • Governance over the impairment processes, including model development,
financing. model approval and model validation, model monitoring and overlay;
The expected credit losses (“ECL”) impairment • Data used to determine the allowances for credit losses including the
model under MFRS 9 “Financial Instruments” completeness and accuracy of the key inputs and assumptions used in the
requires the use of complex models and respective ECL models; and
significant assumptions about future economic
conditions and credit behaviour. • Calculation, review and approval of the ECL computation.
This is also an area of focus as it involves Individual assessment

making significant judgements in applying the
accounting requirements for measuring ECL, Where the loans, advances and financing are individually assessed, we performed
which include the following: the following procedures:
• Building and selecting the appropriate • Examined a sample of loans, advances and financing with focus on loans,
collective assessment models used to calculate financing and advances identified by the Group as having lower credit quality,
ECL. The models are inherently complex and rescheduled and restructured, borrowers in high risk industries and borrowers
judgements is applied in determining the affected by recent adverse market developments and formed our judgement as
appropriate construct of model; to whether there was a significant increase in credit risk or objective evidence
of impairment; and
• Identification of loans, advances and financing
that have experienced a significant increase in • Where objective evidence of impairment was identified and impairment
credit risk; and loss was individually calculated, we assessed the adequacy of impairment
allowance by examining both the quantum and timing of future cash flows used
• Assumptions used in the ECL models, which are by the Group in the impairment loss calculation, challenging the assumptions
expected future cash flows, forwardlooking and comparing estimates to external evidence where available. We also re-
macroeconomic factors, probability weighted performed the calculations of discounted cash flows.
multiple scenarios and ECL overlay adjustments
made, given the economic uncertainty that
may impact the ECL.
314 • FINANCIALS

Key audit matter How our audit addressed the key audit matter
Collective assessment
To determine the appropriateness of the MFRS 9 collective assessment ECL

models implemented by the Group, we have:
• Assessed the methodologies and significant modelling assumptions inherent

within the ECL models applied against the requirements of MFRS 9, including
the basis used by the Group to determine the key assumptions used in
respective ECL models;
• Assessed and considered the reasonableness of forward-looking forecasts

assumptions;
• Assessed the reasonableness and tested the calculation of model overlay

adjustments to the ECL;
• Checked the accuracy of data inputs used in ECL models and checked the
calculation of ECL amount on a sampling basis; and
• Involved our financial risk modelling experts and IT specialists in areas such as
reviewing the appropriateness of the ECL models and data reliability.
Based on the procedures performed, we did not find any material exceptions to
the Group’s assessment on impairment of loans, advances and financing as at
30 June 2023.
We have determined that there are no key audit matters to report for the Company.
Information other than the financial statements and auditors’ report thereon
The Directors of the Company are responsible for the other information. The other information comprises the Directors’ Report and
Annual Report, but does not include the financial statements of the Group and of the Company and our auditors’ report thereon.
Our opinion on the financial statements of the Group and of the Company does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements of the Group and of the Company, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the financial statements of the
Group and of the Company or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the financial statements
The Directors of the Company are responsible for the preparation of the financial statements of the Group and of the Company that
give a true and fair view in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and
the requirements of the Companies Act 2016 in Malaysia. The Directors are also responsible for such internal control as the Directors
determine is necessary to enable the preparation of financial statements of the Group and of the Company that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements of the Group and of the Company, the Directors are responsible for assessing the Group’s and
the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the Directors either intend to liquidate the Group or the Company or to cease operations, or have
no realistic alternative but to do so.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements of the Group and of the Company as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with approved
standards on auditing in Malaysia and International Standards on Auditing will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing, we exercise
professional judgement and maintain professional scepticism throughout the audit. We also:
(a) Identify and assess the risks of material misstatement of the financial statements of the Group and of the Company, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal control.
(b) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s and of the Company’s
internal control.
(c) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by the Directors.
(d) Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s
or on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditors’ report to the related disclosures in the financial statements of the Group and of the Company or,
if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the
date of our auditors’ report. However, future events or conditions may cause the Group or the Company to cease to continue as
a going concern.
316 • FINANCIALS

Auditors’ responsibilities for the audit of the financial statements (continued)
(e) Evaluate the overall presentation, structure and content of the financial statements of the Group and of the Company, including
the disclosures, and whether the financial statements of the Group and of the Company represent the underlying transactions
and events in a manner that achieves fair presentation.
(f) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the
Group to express an opinion on the financial statements of the Group. We are responsible for the direction, supervision and
performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit and significant audit
findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide the Directors with a statement that we have complied with relevant ethical requirements regarding independence,
and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, actions taken to eliminate threats or safeguards applied.
From the matters communicated with the Directors, we determine those matters that were of most significance in the audit of the
financial statements of the Group and of the Company for the current financial year and are therefore the key audit matters. We describe
these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so
would reasonably be expected to outweigh the public interest benefits of such communication.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
In accordance with the requirements of the Companies Act 2016 in Malaysia, we report that the subsidiaries of which we have not
acted as auditors, are disclosed in Note 11 to the financial statements.
OTHER MATTERS
This report is made solely to the members of the Company, as a body, in accordance with Section 266 of the Companies Act 2016 in
Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.
PRICEWATERHOUSECOOPERS PLT ONG CHING CHUAN

LLP0014401-LCA & AF 1146 02907/11/2023 J
Chartered Accountants Chartered Accountant
Kuala Lumpur
20 September 2023
Notice of
Annual General Meeting
NOTICE IS HEREBY GIVEN that the Fifty-Fourth Annual General Meeting (“AGM”) of Hong Leong Financial Group Berhad (“Company”) will be
held at Wau Bulan 2, Level 2, Sofitel Kuala Lumpur Damansara, No. 6, Jalan Damanlela, Bukit Damansara, 50490 Kuala Lumpur on Tuesday,
31 October 2023 at 10.30 a.m. in order:
1. To lay before the meeting the audited financial statements together with the reports of the Directors and
Auditors thereon for the financial year ended 30 June 2023.
2. To approve the payment of Director Fees of RM941,750 for the financial year ended 30 June 2023, to be
divided amongst the Directors in such manner as the Directors may determine and Directors’ Other Benefits
of up to an amount of RM200,000 from the 54th AGM to the 55th AGM of the Company. (Resolution 1)
3. To re-elect the following Directors pursuant to the Company’s Constitution:
(a) YBhg Tan Sri Quek Leng Chan (Resolution 2)

(b) Ms Chong Chye Neo (Resolution 3)
4. To re-appoint PricewaterhouseCoopers PLT as Auditors of the Company and to authorise the Directors to fix
their remuneration. (Resolution 4)
SPECIAL BUSINESS
As special business, to consider and, if thought fit, pass the following motions as resolutions:
5. Ordinary Resolution
- Authority to Directors to Allot Shares
- Waiver of Pre-Emptive Rights over New Ordinary Shares (“Shares”) or Other Convertible Securities
in the Company under Section 85(1) of the Companies Act 2016 (“Act”) read together with
Clause 50 of the Constitution of the Company
“THAT subject to the Act, the Main Market Listing Requirements of Bursa Malaysia Securities Berhad
(“Bursa Securities”) [“MMLR”], the Company’s Constitution and approval of the relevant governmental
regulatory authorities, if required, the Directors be and are hereby empowered pursuant to Sections 75
and 76 of the Act to issue and allot new Shares in the Company, grant rights to subscribe for Shares in the
Company, convert any security into Shares in the Company, or allot Shares under an agreement or option
or offer at any time and from time to time, and upon such terms and conditions and for such purposes as
the Directors may, in their absolute discretion, deem fit, to any persons who are not caught by Paragraph
6.04(c) of the MMLR, provided that the aggregate number of Shares issued and allotted, to be subscribed
under any rights granted, to be issued from conversion of any security, or to be issued and allotted under an
agreement or option or offer, pursuant to this resolution does not exceed 10% of the total number of issued
Shares (excluding treasury shares) of the Company for the time being and that the Directors be and are also
empowered to obtain approval for the listing of and quotation for the additional Shares so allotted on Bursa
Securities and that such authority shall continue in force until the conclusion of the next Annual General
Meeting of the Company;
AND THAT in connection with the above, pursuant to Section 85(1) of the Act read together with Clause 50 of
the Constitution of the Company, the shareholders of the Company do hereby waive their pre-emptive rights
over all new Shares, options over or grants of new Shares or any other convertible securities in the Company
and/or any new Shares to be issued pursuant to such options, grants or other convertible securities, such new
Shares when issued, to rank pari passu with the existing Shares in the Company.” (Resolution 5)
- Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions of a Revenue
or Trading Nature with Hong Leong Company (Malaysia) Berhad (“HLCM”), GuoLine Capital Assets
Limited (“GCA”) and Persons Connected with them
“THAT approval be and is hereby given for the Company and/or its subsidiaries (excluding Hong
Leong Bank Berhad and Hong Leong Capital Berhad and their respective subsidiaries) to enter into
any of the transactions falling within the types of recurrent related party transactions of a revenue
or trading nature as disclosed in Section 2.3(A) and (C) of the Company’s Circular to Shareholders dated
2 October 2023 (“the Circular”) with HLCM, GCA and persons connected with them (“Hong Leong Group”), as
set out in Appendix II of the Circular provided that such transactions are undertaken in the ordinary course
of business, on arm’s length basis and on commercial terms which are not more favourable to Hong Leong
318 • ADDITIONAL INFORMATION
Notice of Annual General Meeting
Group than those generally available to and/or from the public and are not, in the Company’s opinion,
detrimental to the minority shareholders;
AND THAT such approval shall continue to be in force until:
(a) the conclusion of the next Annual General Meeting (“AGM”) of the Company at which time it will lapse,
unless by a resolution passed at the meeting, the authority is renewed; or
(b) the expiration of the period within which the next AGM of the Company after that date is required to
be held pursuant to Section 340(2) of the Companies Act 2016 (but shall not extend to such extension
as may be allowed pursuant to Section 340(4) of the Companies Act 2016); or
(c) revoked or varied by resolution passed by the shareholders in general meeting,
whichever is the earlier;
AND THAT the Directors of the Company be and are hereby authorised to complete and to do all such acts
and things (including executing all such documents as may be required) as they may consider expedient or
necessary to give effect to the transactions contemplated and/or authorised by this ordinary resolution.” (Resolution 6)
- Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions of a Revenue
or Trading Nature with Tower Real Estate Investment Trust (“Tower REIT”)
“THAT approval be and is hereby given for the Company and/or its subsidiaries (excluding Hong Leong Bank
Berhad and Hong Leong Capital Berhad and their respective subsidiaries) to enter into any of the transactions
falling within the types of recurrent related party transactions of a revenue or trading nature as disclosed in
Section 2.3(B) of the Company’s Circular to Shareholders dated 2 October 2023 with Tower REIT provided that
such transactions are undertaken in the ordinary course of business, on arm’s length basis and on commercial
terms which are not more favourable to Tower REIT than those generally available to and/or from the public
and are not, in the Company’s opinion, detrimental to the minority shareholders;
AND THAT such approval shall continue to be in force until:
(a) the conclusion of the next Annual General Meeting (“AGM”) of the Company at which time it will lapse,
unless by a resolution passed at the meeting, the authority is renewed; or
(b) the expiration of the period within which the next AGM of the Company after that date is required to
be held pursuant to Section 340(2) of the Companies Act 2016 (but shall not extend to such extension
as may be allowed pursuant to Section 340(4) of the Companies Act 2016); or
(c) revoked or varied by resolution passed by the shareholders in general meeting,
whichever is the earlier;
AND THAT the Directors of the Company be and are hereby authorised to complete and to do all such acts
and things (including executing all such documents as may be required) as they may consider expedient or
necessary to give effect to the transactions contemplated and/or authorised by this ordinary resolution.” (Resolution 7)
8. To consider any other business of which due notice shall have been given.
By Order of the Board
JACK LEE TIONG JIE

(MAICSA 7060133)
(SSM PC No. 202008001704)
Group Company Secretary
Kuala Lumpur
2 October 2023
NOTES:
1. For the purpose of determining members’ eligibility to attend this meeting, only members whose names appear in the Record of
Depositors as at 23 October 2023 shall be entitled to attend this meeting or appoint proxy(ies) to attend and vote on their behalf.
2. Save for a member who is an exempt authorised nominee, a member entitled to attend and vote at the meeting is entitled to appoint
not more than two (2) proxies to attend, participate, speak and vote in his stead. A proxy may but need not be a member of the
Company. A member who is an authorised nominee may appoint not more than two (2) proxies in respect of each securities account it
holds. A member who is an exempt authorised nominee for multiple beneficial owners in one securities account (“Omnibus Account”)
may appoint any number of proxies in respect of the Omnibus Account.
3. Where two (2) or more proxies are appointed, the proportion of shareholdings to be represented by each proxy must be specified in
the instrument appointing the proxies, failing which the appointments shall be invalid.
4. The Form of Proxy must be deposited at the Registered Office of the Company at Level 30, Menara Hong Leong, No. 6, Jalan Damanlela,
Bukit Damansara, 50490 Kuala Lumpur or lodged electronically via email at cosec-hlfg@hongleong.com.my, not less than forty-eight
(48) hours before the time appointed for holding of the meeting or adjourned meeting.
5. Pursuant to Paragraph 8.29A(1) of the Main Market Listing Requirements of Bursa Securities, all the resolutions set out in this Notice
will be put to a vote by way of a poll.
EXPLANATORY NOTES
1. Resolution 1 on Director Fees and Other Benefits
• Director Fees of RM941,750 are inclusive of Board Committee Fees of RM215,000 and Meeting Allowance of RM126,750.
• Directors’ Other Benefits refer to Directors’ & Officers’ Liability Insurance coverage based on premium paid/payable, and
Directors’ training benefits of up to RM110,000 as well as Chairman’s car benefits of up to RM90,000.
2. Resolutions 2 and 3 on Re-election of Directors
The Board, on the recommendation of the Nomination Committee (“NC”) of the Company, supports the re-election of the retiring
Directors. The NC had reviewed the results of the Board Annual Assessment conducted for the financial year ended 30 June 2023
and noted that the retiring Directors have effectively discharged their duties and responsibilities. The NC had also conducted
assessments on the fitness and propriety of YBhg Tan Sri Quek Leng Chan and Ms Chong Chye Neo including the review of their
Fit and Proper (“F&P”) Declarations and results of their background checks, and was satisfied that they met the F&P criteria as set
out in the F&P Policy of the Company. In addition, the NC had assessed the declaration made by Ms Chong Chye Neo confirming
that she fulfilled the Independent Director criteria as set out in the relevant regulatory requirements, and found it to be in order.
The retiring Directors had abstained from deliberations and decisions on their re-election at the NC and Board meetings, as
applicable.
The profiles and details of the retiring Directors are set out in the Board of Directors’ Profile section of the Company’s 2023
Annual Report.
3. Resolution 5 on Authority to Directors to Allot Shares and Waiver of Pre-Emptive Rights
The proposed Ordinary Resolution, if passed, will renew the general mandate given to the Directors of the Company to allot
ordinary shares (“Shares”) of the Company from time to time and expand the mandate to grant rights to subscribe for Shares in
the Company, convert any security into Shares in the Company, or allot Shares under an agreement or option or offer, provided
that the aggregate number of Shares issued and allotted, to be subscribed under any rights granted, to be issued from conversion
of any security, or to be issued and allotted under any agreement or option or offer, pursuant to this resolution does not exceed
10% of the total number of issued Shares (excluding treasury shares) of the Company for the time being (“Renewed General
Mandate”). In computing the aforesaid 10% limit, Shares issued or agreed to be issued or subscribed pursuant to the approval of
shareholders in a general meeting where precise terms and conditions are approved shall not be counted. The Renewed General
Mandate, unless revoked or varied at a general meeting, will expire at the conclusion of the next AGM of the Company.
As at the date of this Notice, no new Shares in the Company were issued and allotted pursuant to the general mandate given
to the Directors at the last AGM held on 31 October 2022 and which will lapse at the conclusion of the 54th AGM. The Renewed
General Mandate will enable the Directors to take swift action in case of, inter alia, a need for corporate exercises or in the event
business opportunities or other circumstances arise or for compliance with regulatory requirements which involve the issuance
and allotment of new Shares, grant of rights to subscribe for Shares, conversion of any security into Shares, or allotment of
Shares under an agreement or option or offer, and to avoid delay and cost in convening general meetings to approve the same.
Pursuant to Section 85(1) of the Companies Act 2016 (“Act”) read together with Clause 50 of the Constitution of the Company,
shareholders have pre-emptive rights to be offered any new Shares in the Company which rank equally to the existing issued
Shares or other convertible securities.
Section 85(1) of the Act provides as follows:
“85. Pre-emptive rights to new shares
(1) Subject to the constitution, where a company issues shares which rank equally to existing shares as to voting or
distribution rights, those shares shall first be offered to the holders of existing shares in a manner which would, if
the offer were accepted, maintain the relative voting and distribution rights of those shareholders.”
Clause 50 of the Constitution of the Company provides as follows:
“50. Subject to any direction to the contrary that may be given by the Company in general meeting, all new shares or other
convertible securities, shall, before issue, be offered to such persons as at the date of the offer are entitled to receive
notices from the Company of general meetings in proportion as nearly as the circumstances admit, to the amount of the
existing shares or securities to which they are entitled...
Subject to the provisions of this Constitution, the Directors may recognise a renunciation of any share by the allottee
thereof in favour of some other person.”
In order for the Board to issue any new Shares or other convertible securities free of pre-emptive rights, such pre-emptive rights
must be waived. The proposed Ordinary Resolution, if passed, will exclude your pre-emptive rights over all new Shares, options
over or grant of new Shares or any other convertible securities in the Company and/or any new Shares to be issued pursuant to
such options, grants or other convertible securities under the Authority to Directors to Allot Shares.
4. Resolutions 6 and 7 on Recurrent Related Party Transactions of a Revenue or Trading Nature
The proposed Ordinary Resolutions, if passed, will empower the Company and its subsidiaries (excluding Hong Leong Bank
Berhad and Hong Leong Capital Berhad and their respective subsidiaries) (“HLFG Group”) to enter into recurrent related
party transactions of a revenue or trading nature which are necessary for HLFG Group’s day-to-day operations, subject to the
transactions being in the ordinary course of business and on terms which are not more favourable to the related parties than
those generally available to the public and are not, in the Company’s opinion detrimental to the minority shareholders of the
Company (“Proposed Shareholders’ Mandate”).
Detailed information on the Proposed Shareholders’ Mandate is set out in the Circular to Shareholders dated 2 October 2023
which is available on the Company’s corporate website (http://www.hlfg.com.my/agm2023).
Statement Accompanying Notice of Annual General Meeting

(Pursuant to Paragraph 8.27(2) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad)
• Details of individuals who are standing for election as Directors
No individual is seeking election as a Director at the forthcoming Fifty-Fourth Annual General Meeting of the Company.
• Statement relating to general mandate for issue of securities in accordance with Paragraph 6.03(3) of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad
Details of the general mandate to issue securities in the Company pursuant to Sections 75 and 76 of the Companies Act 2016
are set out in Explanatory Note 3 of the Notice of Fifty-Fourth Annual General Meeting.
Other
Information
1. MATERIAL CONTRACTS
There are no material contracts (not being contracts entered into in the ordinary course of business) which had been entered
into by the Company and its subsidiaries involving the interest of Directors, chief executives and major shareholders, either
still subsisting at the end of the financial year or entered into since the end of the previous financial year pursuant to Item 21,
Part A, Appendix 9C of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad.
2. ANALYSIS OF SHAREHOLDINGS AS AT 6 SEPTEMBER 2023
Total number of issued shares : 1,147,516,890

Class of shares : Ordinary shares
Voting rights : 1 vote for each share held
Distribution Schedule of Shareholders as at 6 September 2023
No. of
Size of Holdings Shareholders % No. of Shares %
Less than 100 311 7.53 6,590 0.00

100 – 1,000 1,152 27.91 620,866 0.05
1,001 – 10,000 1,684 40.79 6,423,452 0.56
10,001 – 100,000 741 17.95 23,124,489 2.02
100,001 – less than 5% of issued shares 238 5.77 230,241,397 20.06
5% and above of issued shares 2 0.05 887,100,096 77.31
4,128 100.00 1,147,516,890 100.00
List of Thirty Largest Shareholders as at 6 September 2023
Name of Shareholders No. of Shares %
1. Hong Leong Company (Malaysia) Berhad 595,982,955 51.94

2. Guoco Group Limited 291,117,141 25.37
3. Kumpulan Wang Persaraan (Diperbadankan) 24,946,612 2.17
4. Citigroup Nominees (Tempatan) Sdn Bhd 22,049,310 1.92
- Employees Provident Fund Board
- Employees Provident Fund Board (Nomura)
- Exempt AN for AIA Bhd.
7. RHB Trustees Berhad 9,323,192 0.81
- Exempt AN for Hong Leong Financial Group Berhad (HLFG-ESS)
8. Soft Portfolio Sdn. Bhd. 6,602,130 0.58
9. YBhg Tan Sri Dato’ Seri Khalid Ahmad bin Sulaiman 5,544,000 0.48
10. YBhg Tan Sri Quek Leng Chan 5,438,664 0.47
Other Information
2. ANALYSIS OF SHAREHOLDINGS AS AT 6 SEPTEMBER 2023 (continued)
List of Thirty Largest Shareholders as at 6 September 2023 (continued)
Name of Shareholders No. of Shares %
11. Cartaban Nominees (Asing) Sdn Bhd 5,270,500 0.46

- Exempt AN for State Street Bank & Trust Company (West CLT OD67)
12. Chua Holdings Sdn Bhd 4,967,949 0.43
13. Hong Bee Hardware Company, Sdn. Berhad 4,530,506 0.40
14. Citigroup Nominees (Asing) Sdn Bhd 4,423,359 0.39
- Exempt AN for Bank of Singapore Limited (Foreign)
- Employees Provident Fund Board (Aberdeen)
- Exempt AN for Citibank New York (Norges Bank 14)
17. RHB Trustees Berhad 4,091,900 0.36
- Exempt AN for Hong Leong Financial Group Berhad (HLA-ESS)
18. HSBC Nominees (Asing) Sdn Bhd 3,213,341 0.28
- JPMCB NA for Vanguard Emerging Markets Stock Index Fund
- CBNY for Norges Bank (FI 17)
20. HSBC Nominees (Asing) Sdn Bhd 2,738,932 0.24
- JPMCB NA for Vanguard Total International Stock Index Fund
21. Pertubuhan Keselamatan Sosial 2,600,000 0.23
22. Pertubuhan Keselamatan Sosial 2,432,100 0.21
23. Kheng Lim Holdings Sdn Bhd 2,269,492 0.20
24. Cartaban Nominees (Tempatan) Sdn Bhd 2,171,850 0.19
- PAMB for Prulink Equity Fund
25. Choong Yee How 2,000,000 0.17
26. CIMB Group Nominees (Tempatan) Sdn Bhd 1,938,800 0.17
- CIMB Commerce Trustee Berhad - Kenanga Growth Fund
- CB Spore GW for Government of Singapore (GIC C)
28. Cartaban Nominees (Asing) Sdn Bhd 1,644,934 0.14
- BNYM SA/NV for People’s Bank of China (SICL Asia EM)
29. UOB Kay Hian Nominees (Asing) Sdn Bhd 1,554,127 0.14
- Exempt AN for UOB Kay Hian Pte Ltd (A/C Clients)
30. DB (Malaysia) Nominee (Asing) Sdn Bhd 1,526,000 0.13
- Exempt AN for Deutsche Bank AG Singapore (Asing WM CLT)
1,045,679,405 91.13
Other Information
2. ANALYSIS OF SHAREHOLDINGS AS AT 6 SEPTEMBER 2023 (continued)
Substantial Shareholders
According to the Register of Substantial Shareholders, the substantial shareholders of the Company as at 6 September 2023 are
as follows:
Direct Interest Indirect Interest

Name of Shareholders No. of shares % No. of shares %
Hong Leong Company (Malaysia) Berhad 595,982,955 51.94 - -

Tan Sri Quek Leng Chan 5,438,664 0.47 893,702,226 77.88A
HL Holdings Sdn Bhd - - 595,982,955 51.94B
Kwek Holdings Pte Ltd - - 891,630,602 77.70A
Kwek Leng Beng 1,315,841 0.11 891,630,602 77.70A
Hong Realty (Private) Limited - - 891,630,602 77.70A
Hong Leong Investment Holdings Pte Ltd - - 891,630,602 77.70A
Davos Investment Holdings Private Limited - - 891,630,602 77.70A
Kwek Leng Kee - - 891,630,602 77.70A
Guoco Group Limited 291,117,141 25.37 - -
GuoLine Overseas Limited - - 291,117,141 25.37C
GuoLine Capital Assets Limited - - 291,117,141 25.37C
Notes:
A
Held through Hong Leong Company (Malaysia) Berhad (“HLCM”) and company(ies) in which the substantial shareholder
has interest
B
Held through HLCM
C
Held through Guoco Group Limited
3. DIRECTORS’ INTERESTS AS AT 6 SEPTEMBER 2023
Subsequent to the financial year end, there is no change, as at 6 September 2023, to the Directors’ interests in the ordinary shares,
preference shares and/or options over ordinary shares or convertible bonds of the Company and/or its related corporations (other
than wholly-owned subsidiaries), appearing in the Directors’ Report on pages 113 to 114 as recorded in the Register of Directors’
Shareholdings kept by the Company under Section 59 of the Companies Act 2016 except for the change set out below:
Indirect Interest No. of shares %
YBhg Tan Sri Quek Leng Chan in:
Hong Leong Industries Berhad 242,833,303(1) 76.01

54,667* 0.02
Notes:
(1)
Inclusive of shares vested
* No. of ordinary shares/ordinary shares to be received arising from vesting of shares
Other Information
LIST OF PROPERTIES HELD AS AT 30 JUNE 2023
Description Gross Approx. Net book

of property Area Age value Date of
Location Tenure held (Sq-ft) (Years) (RM’000) acquisition
1 No. 1, Light Street Freehold Branch 20,594 89 7,403 30/12/1986

Georgetown Premises
10200 Pulau Pinang
2 No. 15-G-1, 15-1-1 & 15-2-1 Freehold Branch 9,968 24 1,962 26/06/1997
Medan Kampung Relau Premises
Bayan Point
11900 Pulau Pinang
3 No. 42, Jalan Pending Leasehold Branch 4,425 41 1,177 27/12/1983
93450 Kuching - 859 years Premises
Sarawak (31/12/2779)
4 No. 133, 135 & 137 Freehold Branch 4,871 31 2,745 28/12/1992
Jalan Kampong Nyabor Premises
96000 Sibu, Sarawak
5 Jungle land at Sungai Limut Rajang Leasehold Jungle land 1,217,938 n/a 1 31/12/1938
Sarawak Occupation Ticket - 99 years
612 of 1931 (31/12/2026)
6 No. 25 & 27, Jalan Tun Ismail Freehold Branch 1,600 32 1,028 29/06/1996
25000 Kuantan Premises
Pahang Darul Makmur
7 No. 69, 70 & 71, Freehold Branch 6,000 Pre-war 1,350 27/12/1994
Jalan Dato’ Bandar Tunggal Premises
70000 Seremban
Negeri Sembilan Darul Khusus
8 No. 26, Lorong Rahim Kajai 14 Freehold Branch 3,750 37 469 30/12/1986
Taman Tun Dr Ismail Premises
60000 Kuala Lumpur
9 No. 120-122, Jalan Mersing Leasehold Branch 3,355 57 462 31/05/1990
86000 Kluang - 99 years Premises
Johor Darul Takzim (22/08/2063)
10 No. 100, Jalan Gurney Freehold Branch 5,107 37 1,890 25/06/1992
72100 Bahau Premises
11 No. 12, 14 & 16 Freehold Branch 4,174 32 3,328 25/06/1992
Jalan Wong Ah Fook Premises
80000 Johor Bahru
Johor Darul Takzim
12 No. 63 & 65, Jalan SS 23/15 Freehold Vacant 4,760 28 3,024 28/04/1997
47400 Petaling Jaya
Selangor Darul Ehsan
13 No. 24, Medan Taming 2 Freehold Branch 3,037 27 895 28/04/1997
Taman Taming Jaya Premises
43300 Balakong
Other Information

14 No. 1, Jalan Takal 15/21 Leasehold Branch 2,625 36 1,022 26/06/1997

Seksyen 15 - 99 years Premises
40000 Shah Alam (29/06/2086)
15 Lots 3594 & 3595 Leasehold Branch 3,199 29 172 26/06/1997
Jalan Baru Pak Sabah - 84 years Premises
23000 Dungun (02/02/2079)
Terengganu Darul Iman
16 Lot 3073 & 3074 Leasehold Branch 2,582 26 830 26/06/1997
Jalan Abang Galau - 60 years Premises
97000 Bintulu, Sarawak (12/02/2056)
17 Lot 34, Putra Industrial Park Freehold Warehouse 96,219 27 2,506 26/01/1995
47000 Sungai Buloh
18 No. 1540, Jalan Sultan Badlishah Leasehold Vacant 10,619 48 12 30/06/1977
05000 Alor Setar - 60 years
Kedah Darul Aman (19/07/2030)
19 No. 9A & 9B, Jalan Kampong Baru Freehold Branch 9,320 30 688 01/01/1994
08000 Sungai Petani Premises
Kedah Darul Aman
20 No. 45, Jalan Burma Freehold Vacant 14,277 45 1,658 24/11/1978
10500 Pulau Pinang
21 No. 55-57, Jalan Yang Kalsom Freehold Vacant 11,720 44 862 01/10/1984
30250 Ipoh
Perak Darul Ridzuan
22 No. 27, Jalan Dewangsa Leasehold Branch 4,694 28 216 24/11/1995
31000 Batu Gajah - 79 years Premises
Perak Darul Ridzuan (26/02/2078)
23 No. 75, Jalan Sultan Idris Shah Freehold Branch 1,900 26 567 15/06/1998
30000 Ipoh Premises
Perak Darul Ridzuan
24 No. 80 & 82, Jalan Othman 1/14 Leasehold Branch 9,062 33 749 01/06/1994
46000 Petaling Jaya - 90 years Premises
Selangor Darul Ehsan (15/06/2089)
25 No. 19, Jalan 54, Desa Jaya Leasehold Branch 5,859 41 296 29/11/1985
52100 Kepong - 99 years Premises
26 Lot 111, Jalan Mega Mendung Leasehold Vacant 4,978 43 347 31/07/1988
Kompleks Bandar - 99 years
Off Jalan Klang Lama (11/10/2076)
58200 Kuala Lumpur
27 No. 161, Jalan Imbi Freehold Vacant 2,454 27 2,660 14/02/1996
55100 Kuala Lumpur
Other Information

28 No. 8A-D, Jalan Station Freehold Vacant 12,854 30 284 22/10/1977

80000 Johor Bahru
Johor Darul Takzim
29 No. 109, Main Road Freehold Branch 2,740 35 197 01/09/1988
83700 Yong Peng Premises
Johor Darul Takzim
30 No. 1, Bentong Heights Freehold Branch 5,432 55 27 30/06/1977
28700 Bentong Premises
Pahang Darul Makmur
31 No. 36, Main Road Tanah Rata Leasehold Branch 1,728 83 66 30/08/1982
39000 Cameron Highland - 99 years Premises
Pahang Darul Makmur (24/11/2039)
32 W-1-0, W-2-0 & W-1-1 Freehold Branch 4,545 24 1,008 18/12/1999
Subang Square Business Centre Premises
Jalan SS15/4G
47500 Subang Jaya
33 No. 2828-G-02 & 2828-1-02 Freehold Vacant 12,173 24 1,917 18/12/1999
Jalan Bagan Luar
12000 Butterworth
Pulau Pinang
34 Plot No 20, Jalan Bidor Raya Freehold Branch 3,243 24 433 23/11/1999
35500 Bidor Premises
Perak Darul Ridzuan
35 No. 1, Persiaran Greentown 2 Leasehold Branch 7,870 23 1,286 23/11/1999
Greentown Business Centre - 99 years Premises
30450 Ipoh (21/11/2094)
Perak Darul Ridzuan
36 Lots 39 & 40 Leasehold Branch 5,988 24 997 31/05/1991
Kompleks Munshi Abdullah - 99 years Premises
75100 Melaka (24/02/2084)
37 No. 1 & 2 Jalan Raya Freehold Branch 5,840 22 332 20/09/2000
09800 Serdang Premises
Kedah Darul Aman
38 No. 133 & 135, Jalan Gopeng Freehold Branch 4,700 22 307 13/12/2000
31900 Kampar Premises
Perak Darul Ridzuan
39 No. 65-67, Jalan Tun HS Lee Freehold HLB’s CSR 2,223 27 4,617 14/10/1996
50000 Kuala Lumpur Community
Center
40 No. 64, Jalan Tun Mustapha Leasehold Branch 1,370 32 353 30/05/1991
87007 Labuan - 999 years Premises
(28/12/2881)
Other Information


55100 Kuala Lumpur
55100 Kuala Lumpur
43 No. 114 & 116, Jalan Cerdas Leasehold Branch 12,200 17 3,235 07/06/2006
Taman Connaught - 99 years Premises
56000 Kuala Lumpur (16/10/2078)
44 Lot A08-A09, Jalan SS 6/5A Freehold Branch 9,800 17 2,463 06/07/2006
Dataran Glomac Premises
Pusat Bandar Kelana Jaya
47301 Petaling Jaya
45 No. 2 Jalan Puteri 2/4 Freehold Branch 11,850 16 4,854 28/06/2007
Bandar Puteri Premises
47100 Puchong
46 Tower A, PJ City Development Leasehold Branch 194,489 15 66,671 21/07/2008
46100 Petaling Jaya - 99 years Premises
47 OUG Leasehold Branch 17,300 13 4,304 01/04/2011
No.2, Lorong 2/137C - 99 years Premises
Off Jalan Kelang Lama (year 2088)
58200 Kuala Lumpur
48 KEP Leasehold Branch 30,613 13 7,636 01/05/2011
Lot No 77C & 77D - 99 years Premises
Lot No.58529 Jalan Kepong (07/01/2101)
52100 Kuala Lumpur
49 No. 122, Kapit By-Pass Leasehold Branch 1,200 30 162 30/04/1985
96807 Kapit - 60 years Premises
Sarawak (29/04/2045)
50 No. 12A, Block B Leasehold 1 unit 1,792 36 82 24/05/1983
Level 2, Fraser’s Hill Condominium - 99 years apartment
49000 Bukit Fraser’s (23/05/2082)
Pahang Darul Makmur
51 No. 9, Jalan Cheng Lock Freehold Vacant 2,199 50 247 18/09/1972
50000 Kuala Lumpur
Wilayah Persekutuan
52 No. 3, Jalan Bandar Satu Freehold Branch 4,687 28 1,582 03/04/1997
Pusat Bandar Puchong Premises
47100 Puchong
53 No. 32 & 34, Jalan 21/19 Freehold Vacant 3,080 60 2,062 19/08/1997
Sea Park
46300 Petaling Jaya
Other Information

54 No. 26 & 27, Jalan Kenari 1 Freehold Branch 3,600 27 1,264 22/01/1999
Bandar Puchong Jaya Premises
47100 Puchong
55 No. 2, Jalan PJU 5/8 Leasehold Branch 12,892 19 3,076 12/02/2005
Dataran Sunway, Kota Damansara - 99 years Premises
47810 Petaling Jaya (23/11/2100)
56 No. J09-6 and J02-06 Leasehold 2 units 2,088 27 153 21/04/1994
Paradise Lagoon Holiday Apartment - 99 years apartment
Batu 3 1/2, Jalan Pantai (06/07/2087)
70100 Port Dickson
57 No. S-3, Kompleks Negeri Leasehold Vacant 1,680 39 206 29/06/1981
Jalan Dr. Krishnan - 99 years
70000 Seremban (30/01/2078)
58 No. 105 & 107, Jalan Melaka Raya 24 Leasehold Vacant 3,132 27 411 17/04/1998
Taman Melaka Raya - 99 years
75000 Melaka (20/03/2094)
59 No. 67 & 69, Jalan Merdeka Leasehold Branch 3,080 28 579 15/08/1999
75000 Taman Merdeka Raya - 99 years Premises
Melaka (07/07/2093)
60 No. 35, 37 & 39, Jalan Johor Satu Freehold Branch 13,965 20 1,763 12/02/2003
Taman Desa Cemerlang Premises
81800 Ulu Tiram
Johor Darul Takzim
61 No. 21, Jalan Permas 10/1 Freehold Branch 2,624 26 862 05/04/1999
Bandar Baru Permas Jaya Premises
81750 Masai
Johor Darul Takzim
62 No. B-278 & B-280, Jalan Beserah Freehold Branch 3,208 22 1,250 04/08/1999
25300 Kuantan Premises
Pahang Darul Makmur
63 No. 31, 33, 35 & 37, Jalan Usahaniaga 1 Freehold Branch 15,844 20 1,076 10/07/2003
Taman Niagajaya Premises
14000 Bukit Mertajam
Seberang Perai Tengah, Penang
64 Lot 171, Jalan Council Leasehold Branch 1,740 27 108 21/06/1990
95000 Bandar Sri Aman - 60 years Premises
Sarawak (20/06/2050)
65 Lot No. 2013, Jalan Pisang Barat Leasehold Storage 1,390 30 - 23/09/1992
93150 Kuching - 99 years
Sarawak (31/12/2038)
Other Information

66 No: 3/G14, 3/G15 & 3/G16, Block 3 Leasehold Branch 4,141 28 1,407 04/02/1997
Lorong Api-Api 2 - 99 years Premises
Api-Api Centre (31/12/2086)
88000 Kota Kinabalu, Sabah
67 No. 177, Limbok Hill Freehold Single-storey 6,730 50 9 16/08/1972
70000 Seremban Detached
Negeri Sembilan Darul Khusus House
68 No. 11, Jalan Emas 2 Freehold Vacant 5,804 30 - 25/05/1993
Taman Emas Cheras
43200 Cheras, Selangor
69 No. 53 & 55, Jalan Sultan Ismail Freehold Branch 9,600 26 17,384 01/06/2015
50250 Kuala Lumpur Premises
70 No. 300, Jalan Jelutong Freehold Branch 16,652 21 12,535 23/06/2015
11600 Pulau Pinang Premises
71 Lot 1, Block 35 Leasehold Branch 13,880 51 4,569 17/08/2015
Fajar Commercial Complex - 998 years Premises
Jalan Lembaga (31/12/2895)
91000 Tawau, Sabah
72 Menara Hong Leong Freehold Head Office 668,331 8 536,098 03/07/2015
No. 6, Jalan Damanlela / Branch
Bukit Damansara Premises
50490 Kuala Lumpur
73 01-01, 01-02, 01-03, 01-05, Blok D Leasehold Branch 18,317 5 13,944 16/11/2018
Komersil Southkey Mozek - 99 years Premises
Persiaran Southkey 1 (21/02/2100)
80150 Kota Southkey
Johor Bahru
74 No. 8, Jalan 3/5-C Leasehold Branch 6,908 5 1,976 13/09/2018
Taman Setapak Indah Jaya - 99 years Premises
Off Jalan Genting Klang (28/08/2086)
53300 Kuala Lumpur
75 No. Hakmilik 1205, No Lot 4057 Freehold Vacant 65,340 2 10,342 25/02/2021
Muikim 06
Daerah Seberang Perai Tengah
Pulau Pinang
76 Lot 942 Jalan Parry Leasehold Branch 5,496 26 711 31/01/1997
98000 Miri - 60 Years Premises
Sarawak (06/04/2057)
77 Lot 1, 2 & 3, Block 18 Freehold Branch 6,760 23 2,630 08/11/2001
Bandar Indah, Mile 4 Premises
North Road, Bandar Indah
Sandakan, Sabah
Other Information

78 No 3 Persiaran Greentown 4 Leasehold Branch 8,846 28 385 04/12/1995

Greentown Business Centre - 99 Years Premises
30450 Ipoh (21/11/2094)
79 Bangunan HLA Leasehold Branch 6,019 34 334 30/12/1989
7 Jalan Yayasan - 99 Years Premises
86000 Kluang (23/03/2084)
80 Wisma Hong Leong Freehold Office 333,594 22 260,000 13/11/2001
18 Jalan Perak Premises
50450 Kuala Lumpur
81 Unit 2.1.2, 1A, Stonor Condominium Leasehold Condominium 1,904 30 435 30/06/1993
Off Jalan Conlay - 99 Years
50450 Kuala Lumpur (17/07/2083)
82 Unit 1.1.5, 1A Stonor Condominium Leasehold Condominium 1,815 30 414 30/06/1993
Off Jalan Conlay - 99 Years
50450 Kuala Lumpur (17/07/2083)
83 14-23 Darul Aman Freehold Branch 5,610 30 442 21/02/1993
Jalan Tun Ismail Premises
25000 Kuantan
Pahang Darul Makmur
84 No 1 Persiaran Greentown 4 Leasehold Branch 5,246 28 403 04/12/1995
Pusat Perdagangan Greentown - 99 Years Premises
30450 Ipoh (21/11/2094)
Perak Darul Ridzuan
85 Block B, PJ City Leasehold Office 202,194 15 53,872 29/04/2008
Jalan 219 Seksyen 51A - 99 Years Premises
46100 Petaling Jaya (12/12/2107)
86 31 & 32 Jalan Kundang Freehold Branch 8,932 31 1,398 31/12/2013
Taman Bukit Pasir Premises
83000 Batu Pahat
Johor
87 Menara Raja Laut Freehold Office 839,574 30 209,000 06/04/2015
No. 288 Jalan Raja Laut Premises
50350 Kuala Lumpur
Wilayah Persekutuan
88 No 2682 Jalan Aston Freehold Branch 10,160 5 2,589 14/03/2018
14000 Bukit Mertajam Premises
Pulau Pinang
89 51-53, Persiaran Greenhill Freehold & Branch 4,793 29 1,674 31/12/1993
30450 Ipoh Leasehold Premises
Perak Darul Ridzuan - 999 years
90 Unit 1-10, 8th Floor Leasehold Office 20,000 28 52,196 20/02/2010
Island Place Tower, Island Place - 55 Years Premises
No 510 King’s Road (30/06/2047)
Hong Kong
FORM OF PROXY Registration No. 196801000439 (8024-W)
I/We
NRIC/Passport/Company No.
of
being a member of HONG LEONG FINANCIAL GROUP BERHAD (the “Company”), hereby appoint
NRIC/Passport No.
of
or failing him/her
NRIC/Passport No.
of
or failing him/her, the Chairman of the meeting as my/our proxy/proxies to vote for me/us on my/our behalf at the Fifty-Fourth Annual General Meeting
of the Company to be held at Wau Bulan 2, Level 2, Sofitel Kuala Lumpur Damansara, No. 6, Jalan Damanlela, Bukit Damansara, 50490 Kuala Lumpur on
Tuesday, 31 October 2023 at 10.30 a.m. and at any adjournment thereof.
My/Our proxy/proxies is/are to vote as indicated below with an “X”:
RESOLUTIONS FOR AGAINST

1. To approve the payment of Director Fees and Directors’ Other Benefits
2. To re-elect YBhg Tan Sri Quek Leng Chan as a Director
3. To re-elect Ms Chong Chye Neo as a Director
4. To re-appoint PricewaterhouseCoopers PLT as Auditors of the Company and to authorise the Directors to fix their
remuneration
SPECIAL BUSINESS
5. To approve the ordinary resolution on Authority to Directors to Allot Shares and Waiver of Pre-emptive Rights
6. To approve the ordinary resolution on the Proposed Renewal of Shareholders’ Mandate for Recurrent Related
Party Transactions of a Revenue or Trading Nature with Hong Leong Company (Malaysia) Berhad, GuoLine
Capital Assets Limited and persons connected with them
7. To approve the ordinary resolution on the Proposed Renewal of Shareholders’ Mandate for Recurrent Related
Party Transactions of a Revenue or Trading Nature with Tower Real Estate Investment Trust
Dated this day of 2023
Number of shares held Signature(s) of Member
CDS Account No.
Notes:
1. For the purpose of determining members’ eligibility to attend this meeting, only members whose names appear in the Record of Depositors as at 23 October 2023
shall be entitled to attend this meeting or appoint proxy(ies) to attend and vote on their behalf.
2. If you wish to appoint other person(s) to be your proxy, insert the name(s) and address(es) of the person(s) desired in the space so provided.
3. If there is no indication as to how you wish your vote(s) to be cast, the proxy will vote or abstain from voting at his/her discretion.
4. A proxy may but need not be a member of the Company.
5. Save for a member who is an exempt authorised nominee, a member shall not be entitled to appoint more than two (2) proxies to attend, participate, speak and vote
at the same meeting. Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991, it may
appoint not more than two (2) proxies in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities
account. A member who is an exempt authorised nominee for multiple beneficial owners in one securities account (“Omnibus Account”) may appoint any number of
proxies in respect of the Omnibus Account.
6. Where two (2) or more proxies are appointed, the proportion of shareholdings to be represented by each proxy must be specified in the instrument appointing the
proxies, failing which the appointments shall be invalid (please see note 9 below).
7. In the case where a member is a corporation, this Form of Proxy must be executed under its Common Seal or under the hand of its duly authorised attorney or officer.
8. All Forms of Proxy must be duly executed and deposited at the Registered Office of the Company at Level 30, Menara Hong Leong, No. 6, Jalan Damanlela, Bukit
Damansara, 50490 Kuala Lumpur or lodged electronically via email at cosec-hlfg@hongleong.com.my, not less than forty-eight (48) hours before the time appointed
for holding of the meeting or adjourned meeting.
9. In the event two (2) or more proxies are appointed, please fill in the ensuing section:
Name of Proxies % of shareholdings to be represented
1O. Pursuant to Paragraph 8.29A(1) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, all resolutions set out in the notice will be put to a vote
by way of a poll.
Fold this flap for sealing
Then fold here
AFFIX
STAMP
The Group Company Secretary

Registration No. 196801000439 (8024-W)
Level 30, Menara Hong Leong

No. 6, Jalan Damanlela
Bukit Damansara
50490 Kuala Lumpur
Malaysia
1st fold here

Hong Leong Financial Group Berhad
Registration No. 196801000439 (8024-W)
Level 30, Menara Hong Leong

No. 6, Jalan Damanlela, Bukit Damansara
50490 Kuala Lumpur
Tel : 03-2080 9888
Fax : 03-2080 9800
www.hlfg.com.my
As part of Hong Leong Financial Group’s support for environmental sustainability,

this Annual Report is printed on Forest Stewardship Council (FSC) certified paper.

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Annual Report 2023

Corporate Financials Additional Information

86 Key Senior Management of the

Management Committee Report

Hong Leong Financial Group Berhad offers an

• Personal Financial Services • Investment Banking • Life & General Insurance

Innovation Human Resource Honour Unity

Five Year Group

+9.9% y-o-y +13.8% y-o-y +5.4% y-o-y

315,266 2,791 5,102

FY2019 FY2020 FY2021 FY2022 FY2023

Statements of Financial Position

Total assets 237,883 253,603 273,280 286,921 315,266

Net loans 137,058 145,521 154,779 167,177 180,567

Total liabilities 209,282 222,550 239,347 250,931 275,636

Deposits from customers 161,888 171,237 181,769 197,383 211,467

Shareholders' funds 19,097 20,898 22,818 24,276 26,792

Commitments and contingencies 174,186 154,879 285,690 214,693 269,009

Revenue 5,278 5,258 6,199 6,252 6,429

Profit before tax 3,506 3,300 3,972 4,840 5,102

Net profit 2,914 2,779 3,376 3,683 4,208

Five Year Group Financial Highlights

+13.8% y-o-y +0.5% y-o-y +10.3% y-o-y

The Group FY2019 FY2020 FY2021 FY2022 FY2023

Key Performance Indicators

Share price (RM) 18.54 13.10 17.80 18.50 17.66

Dividend per share (sen) 42.0 38.0 40.0 46.0 49.0

Financial Ratios (%)

Return on equity 10.4% 9.3% 10.4% 10.4% 10.9%

Return on average assets 0.8% 0.8% 0.9% 0.9% 0.9%

Cost/income ratio 45.1% 44.9% 38.6% 37.7% 40.0%

Asset Quality/Loan Ratios

Gross loans to deposits ratio 85.4% 85.7% 86.1% 85.6% 86.2%

Gross impaired loans ratio 0.8% 0.6% 0.5% 0.5% 0.6%

Simplified Group Statements of

58.3% Loans, advances and financing 57.3%

3.3% Cash and short-term funds 3.1%

31.6% Portfolio of securities 31.7%

Deposits and placements with banks 0.3%

0.2% Statutory deposits with Central Banks 1.1%

6.1% Other assets (including goodwill) 6.5%

68.8% Deposits from customers 67.1%

Deposits and placements of banks

Obligations on securities sold under

Borrowings and subordinated

Liabilities & Equity Liabilities & Equity

6.7% Other liabilities 6.6%

0.8% Share capital 0.7%

4.1% Non-controlling interests 4.1%

Revenue 1,559 1,544 1,503 1,645 6,252

Profit before tax 1,174 1,202 1,130 1,334 4,840

Net profit 965 839 872 1,008 3,683

Key Performance Indicators

Share price (RM) 18.3 17.3 19.6 18.5 18.5

Dividend per share (sen) - 15.0 - 31.0 46.0

Revenue 1,645 1,704 1,615 1,465 6,429

Profit before tax 1,262 1,436 1,274 1,131 5,102

Net profit 1,039 1,161 1,064 944 4,208