19 KENANGA INVESTMENT BANK BERHAD Annual Report 2022 GROUP MANAGING DIRECTOR’S MANAGEMENT DISCUSSION AND ANALYSIS In FY2022 KIG expanded upon its Sustainability Blueprint to include the fixed-income asset class by establishing an in-house ESG assessment to perform positive screening for bonds/ sukuk based on independent and accredited external data sources. On the equity front, a more comprehensive sector/ industry-focused assessment was established for sectors with high ESG risk. To effectively manage and monitor risks, various factors and indicators specific to respective industries such as palm oil, oil & gas, banking & finance, power, and mining were integrated into this process for a more holistic perspective. For its stellar fund performance, KIG won several industry accolades including the 2023 Refinitiv Lipper Fund Awards where the Kenanga Malaysian Inc Fund won ‘Equity Malaysia Diversified for 10 Years’ while the Kenanga Managed Growth Fund won ‘Mixed Asset MYR Flexible for 3, 5 and 10 Years’. KIG itself won the ‘Malaysia Provident Funds Group Award’. At Asia Asset Management’s 2023 Best of the Best Awards, KIG was named ‘Malaysia Best Equity Manager’, ‘Malaysia Best Impact Investing Manager’, ‘Malaysia Best House for Alternatives’, and ‘Malaysia Most Improved Fund House’. KIB’s Chief Executive Officer and Executive Director, Datuk Wira Ismitz Matthew De Alwis was named ‘Malaysia CEO of the Year’. KIG also received recognition at the 2022 Morningstar Fund Awards Malaysia which awarded the Kenanga Growth Fund Series 2 (USD) with its inaugural win with the best ‘Malaysia Large-Cap Equity’ title. The Asset Benchmark Research ranked KIG as Highly Commended on its list of ‘Top Investment Houses’ in the Asian Local Currency Bond Awards for Asset Managers. The FSMOne Recommended Unit Trusts Awards 2022/2023, named Kenanga Growth Fund Series 2 as ‘Sector Equity – Malaysia Focused’ and Kenanga Shariah Growth Opportunities Fund as ‘Sector Equity - Malaysia Small to Medium Companies (Islamic)’. At the Sustainability Performance Awards, the Group’s Sustainable Products award recognised KIG’s multiple ESG-linked funds through the Kenanga Sustainability Series, particularly the first SRI-qualified bond fund in Kenanga Sustainability Series: High Yield Bond Fund. The Group’s Asset and Wealth Management division consists of Kenanga Investors Berhad (“KIB”), Kenanga Islamic Investors Berhad (“KIIB”), and I-VCAP Management Sdn Bhd (“I-VCAP”) collectively known as Kenanga Investors Group (“KIG”), as well as Digital Investment Management and Wealth Management units, where offerings include a range of conventional collective investment schemes, robo-advisory, portfolio management services as well as alternative investments. Despite the overall downtrends in the market, our Asset and Wealth Management division recorded exceptional growth in FY2022, with a PBT of RM54.2 million over RM34.9 million the previous year. These results were due to significantly higher earnings from management and performance fees resulting from the ongoing expansion of KIG’s business and widening of its client base through multi-segmental products and services targeted individually at mass-retail, middle-high-income, and ultra-high-net-worth investors. To meet the diverse demands of its investors, KIG has implemented a multi-segment and multi-product strategy. This was illustrated through the expansion of the Kenanga Sustainability Series with the launch of the Kenanga Sustainability Series: High Yield Bond Fund, the first Sustainable and Responsible Investment (“SRI”)-qualified high yield bond fund in Malaysia and the Kenanga Sustainability Series: World Quality ESG Fund which aims to deliver long-term capital growth by investing in securities that exhibit quality and favourable ESG characteristics. Following KIG’s appointment as the Fund Manager for Dana Wakaf Bencana in 2021, the Kenanga Sustainability Series: Emergency Waqf Musa’adah Fund was launched to generate sustainable returns that will directly benefit disaster victims in the country by helping them return to normalcy. Returns will also go towards providing new or improving existing climate change disaster-control-related facilities or equipment. KIB continues to expand its network of licensed unit trust and private retirement scheme consultants which has grown to nearly 5,500 in FY2022 compared to 4,500 in FY2021. Asset and Wealth Management
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