Kenanga Investment Bank Berhad Annual Report 2021 308 Our Sustainability Approach About This Report We Are Kenanga Message From Chairman and GMD 50. FINANCIAL RISK MANAGEMENT (CONT’D.) (b) Market risk (cont’d.) (iii) Equity price sensitivity analysis (cont’d.) Change in equity price 2021 Impact on profit or loss 2021 RM’000 Impact on equity 2021 RM’000 Change in equity price 2020 Impact on profit or loss 2020 RM’000 Impact on equity 2020 RM’000 Equity- +30% 17,179 - +30% 16,932 - investments -30% (49,939) - -30% (37,245) - From risk management perspective, a risk limits framework governing the activities of equity and equity derivatives trading has been established, primarily intended to: 1) Prevent excessive exposures to a single risk factor or a group of risk factors; and 2) Constrain the general level of risk taking for a business. Additionally, other components of limit framework including loss trigger, issuance size, permitted products, management oversights etc. were put in place for better governance as well as to embrace best practices of market risk management. The risk framework was designed in accordance to the Group’s and the Bank’s risk appetite and a closely controlled risk parameter, e.g. loss trigger, will ensure losses arising from the course of trading are limited. In addition, the Group’s associate company has made some equity investments in Saudi Arabia. The impact of a +/- 30% change in equity prices on the Group arising from these investments are shown as follows: Change in equity price 2021 Impact on profit or loss 2021 RM’000 Impact on equity 2021 RM’000 Change in equity price 2020 Impact on profit or loss 2020 RM’000 Impact on equity 2020 RM’000 Equity- +30% - 17,403 +30% - 12,197 investments -30% - (17,403) -30% - (12,197) Notes to the Financial Statements 31 December 2021
RkJQdWJsaXNoZXIy NDgzMzc=