KENANGA ANNUAL REPORT 2019

269 50. FINANCIAL RISK MANAGEMENT (CONT’D.) (a) Credit risk (cont’d.) (ii) Credit quality by class of financial assets (cont’d.) Bank Neither past due nor impaired Strong credit profile Stage 1 RM’000 Satisfactory risk Stage 1 RM’000 Sub- standard* Stage 1 RM’000 Non rated Stage 1 RM’000 Stage 2 RM’000 Default/ impaired Stage 3 RM’000 ECL on individually impaired RM’000 ECL on collectively impaired RM’000 Total RM’000 31 December 2018 Cash and bank balances 1,116,117 - - - - - - - 1,116,117 Statutory deposit with Bank Negara Malaysia 116,619 - - - - - - - 116,619 Financial assets at FVTPL Islamic Corporate Bills 19,861 - - - - - - - 19,861 Unquoted shares and unit trust funds in Malaysia 131,077 - - - - - - - 131,077 Net loans, advances and financing Term loans 3,840 361,205 50,010 - 6,417 - - (1,402) 420,070 Islamic term loans - 106,068 60,050 - - - - - 166,118 Share margin financing 442,927 709,011 111,708 59,477 30,417 58,284 (21,253) (8,847) 1,381,724 Islamic share margin financing - 43 7,750 - - - - - 7,793 Others - - - 60 - - - - 60 Financial investments at FVOCI Debt instruments: Malaysian Government Securities 40,182 - - - - - - - 40,182 Malaysian Government Investment Certificates 195,055 - - - - - - - 195,055 Islamic Corporate Sukuk 584,853 - - - - - - - 584,853 Corporate Bonds 160,667 - - - - - - - 160,667 Negotiable Instruments of Deposits 50,000 - - - - - - - 50,000 Islamic Negotiable Instruments of Deposits 629,165 - - - - - - - 629,165 Equity instrument: Unquoted equities - - - 1,754 - - - - 1,754 Financial investments at AC Corporate Bonds 20,038 - - - - - - - 20,038 Malaysian Government Investment Certificates 9,876 - - - - - - - 9,876 Islamic Corporate Sukuk 70,202 - - - 22,000 - - (860) 91,342 Derivative financial assets - - - 71,992 - - - - 71,992 Balances due from clients and brokers - 297,840 - - - 12,938 (12,938) (1,517) 296,323 Other assets 65,687 - - - - 5,772 (3,226) (259) 67,974 Total 3,656,166 1,474,167 229,518 133,283 58,834 76,994 (37,417) (12,885) 5,578,660 * Majority of the sub-standard rating profile credits are from share margin and structured loan financing portfolio in which the credit risks are mitigated with guarantor with acceptable financial strength and adequate collateral coverage. These accounts are monitored on a daily basis in terms of their ability in meeting the minimum security coverage requirements and appropriate actions such as force selling or indulgence are considered to manage the exceptions. NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2019