15 How We Are Governed Financial Statements Shareholders’ Information Additional Information CORPORATE HIGHLIGHTS In February 2021, our Asset and Wealth Management division, Kenanga Investors Berhad (“KIB”) completed the acquisition of I-VCAP Management Sdn Bhd (“I-VCAP”), an award-winning Shariah compliant investment management service provider, focused on Islamic Exchange Traded Fund (“ETF”) products. The acquisition will serve to broaden the division’s product suite and investment expertise while also providing greater access to the U.S. market, thus providing additional breadth and depth to investment solutions available to our clients. In a move to catalyse growth of technology-driven enterprises in the country, Kenanga Investment Bank, in March 2021, joined hands with Malaysia Debt Ventures Berhad (“MDV”), a Government-linked agency focused on financing emerging technology, to set up a new fund intended to increase access to capital for the fintech and technology start-up sectors in the country. Under the strategic partnership, Kenanga Group and MDV will act as joint managers and co-investors in the establishment of a new RM300 million fund intended to support the growth of fintech companies, as well as the continuing development of Malaysia’s burgeoning venture capital industry by providing fintech companies access to financing from inception to the pre-Initial Public Offering (“IPO”) stage. The collaboration will leverage on both our expertise in equity and debt financing, as well as investment capabilities and established capital market access. In the same month, we were awarded a Digital Investment Manager licence from the Securities Commission Malaysia, allowing us to provide a proprietary robo-advisory platform to investors. At the time of this statement, we have just rolledout a fully A.I-driven robo-advisory platform, Kenanga Digital Investing, to overwhelming market interest, and we anticipate this innovative product, boasting competitive rates and stateof-the-art technology, will resonate well with many first-time investors in the country. With the marked shift towards online transactions in recent years, exacerbated by the pandemic and digital advancements, it was imperative for us to rethink our branch network in the country. To date, we have rationalised twelve (12) branches nationwide, with all our remisiers operating on the Remisier Mobility Platform that provides them the flexibility to service their clients remotely. This re-organisation, on the back of declining over-thecounter transactions, is not only expected to derive operational efficiencies but also, cost synergies over time. Our private equity arm had an exceptional year in 2021, with Fund I vintages maturing and in the harvesting period. In 2021, we saw one of our Fund I investee companies successfully undertake an IPO which allowed us to crystalise a significant investment gain, and another investment is also expected to seek liquidity event via listing on Bursa Malaysia in 2022. During the year, we also invested in licensed digital asset exchange player, Tokenize Technologies Sdn Bhd under our Fund II, which focuses on early stage companies. The investment in Tokenize is a landmark investment as it is the first investment by a financial institution in the cryptocurrency space in Malaysia. FINANCIAL POSITION As at 31 December 2021, capital adequacy ratios were 28.3% and 29.8% at Group and Company levels respectively, which were in excess of the minimum regulatory capital adequacy of 10.5% set by Bank Negara Malaysia, including a capital conservation buffer of up to 2.5% if imposed. Liquidity Coverage Ratio was 152%, well above the regulatory requirement of 100% while Net Stable Funding Ratio averaged at 114%, above the mandatory minimum of 100%. The Group maintained A+ and MARC-1 ratings from the Malaysian Rating Corporation Berhad (“MARC”), which noted our strong competitive position, sound capital position, profitability and funding profile despite weakened capital market conditions. As always, we will continue to work towards achieving the best ratings by constantly improving our financial performance. For the same period, our subsidiary KIB and its wholly-owned subsidiary Kenanga Islamic Investors Berhad (“KIIB”) maintained MARC IMR-2 ratings, affirming our commitment to wellestablished investment processes and sound risk management practices.
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