DIALOGUE SESSION WITH BCT

17 April 2012
1. Approving Authority
2. CB Loan Portfolio & BCT
3. Industry Outlook 2012
4. Roles & Responsibilities of BCT
5. Challenges & Concerns
6. Q & A
7. Contact BCT

AGENDA
APPROVING AUTHORITY
APPROVING AUTHORITY
GROUP WHOLESALE BANK RISK COMMITTEE
(GWBRC)
(Independent Evaluation : CRM)
Up to RM400M
Per borrower basis
REGIONAL CREDIT COMMITTEE (RCC)
(Independent Evaluation : RCM)
Up to RM400M
Non Malaysian centric customers
CONSUMER BANK CREDIT COMMITTEE
(CBCC)
(Independent Evaluation : BCM)
Up to RM50M
Per borrower basis subject to maximum Group
Exposure of RM100M
COMMERCIAL BANKING
(Independent Evaluation : BCT)
Up to RM10M
Per borrower basis of which up to RM2M
unsecured subject to Group Exposure not
exceeding RM40M, of which up to RM5M is
unsecured
ATTACHMENT 3.4 (CPG) Effective date: 9/2/2012
ATTACHMENT 3.4 (CPG) Effective date: 9/2/2012
CB LOAN PORTFOLIO & BCT
BREAKDOWN OF CB ACCOUNTS
LIMIT NO %
< = RM10M 6,359 95%
> RM10M to RM50M 284 4%
> RM50M 31 1%
TOTAL 6,674* 100%
*As at Feb 2011
6,359 , 96%
284 , 4%
31 , 0%
3,080 , 48%
2,008 , 32%
709 , 11%
562 , 9%
LIMIT NO %
< = RM1M 3,080 48%
> RM1M to < = RM3M 2,008 32%
> RM3M to < = RM5M 709 11%
> RM5M to < = RM10M 562 9%
TOTAL 6,359 100%
BREAKDOWN OF CB ACCOUNTS RM10M & BELOW
*As at Feb 2011
CB LOAN PORTFOLIO Loan Outstanding
LIMIT RM %
< = RM10M 7,007,419,086 60%
RM10M to RM50M 3,000,395,924 26%
> RM50M 1,692,636,982 14%
TOTAL 11,700,451,992* 100%
60%
26%
14%
*includes contingent as at Feb 12
CB LOAN PORTFOLIO No of Account
OLD DA
LIMIT NO %
< = RM5M 5,797 87%
> RM5M to RM40M 834 12%
> RM40M 43 1%
TOTAL 6,674* 100%
NEW DA
LIMIT NO %
< = RM10M 6,359 95%
> RM10M to RM50M 284 4%
> RM50M 31 0%
TOTAL 6,674 100%
DIFFERENCE
LIMIT NO %
< = RM10M 562 8%
> RM10M to RM50M (550) -8%
> RM50M (12) 0%
TOTAL - 0%
*as at Feb 2012
Plus new accounts
-
20
40
60
80
100
120
140
160
180
T
O
T
A
L

S
U
B
M
I
S
S
I
O
N

(
B
Y

N
O
)
GWBRC 12 10 17 16 18 11 20 11 17 10 12 11 19 4 4
CBCC 76 59 82 81 53 81 57 69 61 67 55 61 46 48 39
BCT 45 39 66 52 52 63 47 69 46 69 62 82 45 48 84
Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12
Total 133 108 165 149 123 155 124 149 124 146 129 154 110 100 127
Total 2011 % Q1 2011 % Q1 2012 %
GWBRC 165 10 39 10 27 8
CBCC 802 48 217 53 133 39
BCT 692 42 150 37 177 53
Total 1,659 100 406 100 337 100
SUBMISSION TRENDING* GWBRC, CBCC & BCT
*New & enhancement only
-
100
200
300
400
500
600
700
800
900
1,000
T
O
T
A
L

S
U
B
M
I
S
S
I
O
N

(
B
Y

A
M
T
)
GWBRC 155 190 410 552 364 335 390 211 229 278 468 241.6 559 178 37
CBCC 287 208 330 219 251 434 230 333 247 264 240 247 235 357 388
BCT 56 49 95 63 81 92 67 101 71 91 75 128 72 84 177
Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12
Total 499 447 834 834 696 861 687 645 548 633 782 616 866 619 602
Total 2011 % Q1 2011 % Q1 2012 %
GWBRC 3,824 47 755 42 774 37
CBCC 3,289 41 825 46 980 47
BCT 970 12 200 12 334 16
Total 8,082 100 1,780 100 2,087 100
SUBMISSION TRENDING* GWBRC, CBCC & BCT
*New & enhancement only
SUBMISSION TO BCT NEW & ENHANCEMENT 2012
Jan Feb Mar Jan Feb Mar
BY NO BY AMT (RMM)
45
48
84
71.9
84.3
177.4
75% 110%
SUBMISSION TO BCT ALL CA 2012
Jan Feb Mar Jan Feb Mar
BY NO BY AMT (RMM)
197
346
454
291.4
615.1
931.1
31% 51%
Lim Ai Lean
Credit Manager
Business Credit Team I

Ramanathan Chettiar

Credit Manager
Business Credit Team II
Lim Liang Hoe
Credit Manager
Business Credit Team III
Yong Ee-Lin
Credit Manager
Business Credit Team IV
1. Penang
2. Menara BHL
3. Sarawak
4. Sabah
5. Perak
6. Puchong

1. JBU
2. Kedah/Perlis
3. Seremban
4. Melaka
5. Virtual
6 PDM

1. Johor
2. Kelantan
3. Pahang
4. Terengganu
5. SAT
6. CBS
1. KL 1
2. KL 2
3. KL 3
4. Shah Alam
5. Jalan Barat
6. Klang
255
539
262
238
213
109
BC NO
TOTAL 1,616
BC BC BC NO NO NO
98
265
287
306
NA
367
545
174
231
130
NA
5
248
294
262
252
555
236
TOTAL TOTAL TOTAL 1,323 1,085 1,847
CREDIT MANAGER NO %
Lim Ai Lean 1,616 28%
Ramanathan 1,323 23%
Lim Liang Hoe 1,085 18%
Yong Ee-lin 1,847 31%
TOTAL 5,871* 100%
BREAKDOWN OF CB ACCOUNTS (RM10M & BELOW) BY CREDIT MANAGER
*As at Feb 2011, excludes BLA & z accounts
ORGANIZATIONAL CHART
18
HR CHALLENGES
1. RECRUITMENT:
Credit Evaluators - Currently 8 Credit Evaluators
To increase to 16
Credit Managers - Currently 4 Credit Managers
Fraud Detection Team - New
To work with Venkat & team and collaborate with RCO (Wai Cheng)
2. ATTACHMENT:
Attachment at BCM for Credit Evaluators - 1 month
PROCESS IMPROVEMENT
1. ANNUAL REVIEWS:
To get concurrence from CCZ
To work with CCZ to develop Annual Review Guide
2. NEW & ENHANCEMENTS Escalation Process:
BCT to have first right of refusal before escalation to CB Management
3. DA FOR CREDIT MANAGER:
Up to RM2M unsecured for new & enhancements 1 person to sign
4. VISIT TO ALL REGIONS:
To brief BCs of the new DA etc

INDUSTRY OUTLOOK 2012
INDUSTRY OUTLOOK 2012
FAVOURABLE
Oil and gas, plantation,
construction, rubber glove and F&B
industries.
Positive outlook on building
materials industry especially in
infrastructure related activities due
to ETP
Should work with CCS and
Corporate Bkg to enhance our
position in the construction sector,
targeting especially sub contractors
involved in ETP projects.

CHALLENGING
To remain cautious on real estate
particularly commercial
development.
Be vigilant on resort development
which is in the negative list
Hotels, furniture, scrap metal,
garment & textile, manufacturing of
shoes

HOTEL FINANCING
ROLES & RESPONSIBILITIES OF BCT
Protect the Banks interest in terms of recommending
quality loans and observe the principle of risk vs
return
Provide independent validation and research for CB
to make informed decisions.
Ensure compliance of terms and conditions
Sharing of information / loan structuring and ideas
with SBU
Ensuring the Banks Policy and Procedure & statutory
and regulatory provision are adhered to
ROLE OF INDEPENDENT CREDIT EVALUATION
Background of the borrower eg. Shareholders, nature &
viability of business, management
Financial analysis
Track record CCRIS, CTOS, market check
Risk analysis
Recommendation & Rationale
INDEPENDENT EVALUATION COVERAGE
PLEASE GOOGLE
Please "google" the names of the
company and directors whenever you
process New/Additional cases so that
we can make informed decisions.
A STORY TO SHARE
A simple straight forward BPL
C Sdn Bhd is buying a 4 storey office cum factory from F Sdn Bhd
The said property is currently charged to us for facilities granted to F
Sdn Bhd
F Sdn Bhd is a potential NPL a/c
BC did not probe further
BCT spent 2 days to do the checkings
Help us to help you

CHALLENGES & CONCERNS
SUBMISSION OF CA
Group Exposure for correct routing of papers.
Case 1: Unsecured portion of RM2.4M
Case 2: Unsecured portion of RM4.6M
Case 3: Exposure to Selangor State Govt (30%
shareholding)
Case 4: Regional Exposure (Spore) not
aggregated
Case 5: Bridging loan for RM10.5M
How Obtained?
In BIR referred by CIMB staff
To clearly state the referees name & to
elaborate further in credit memo
Application History
Previous applications (within a year) rejected
by the bank not highlighted in CA

Enhancement for Watchlist Account
CCZ recommends BC to reduce exposure but BC
put up for enhancement
BC to get concurrence from CCZ before submitting
and to indicate clearly under preamble
CTOS & CCRIS
Credit summary reports on existing borrower and
guarantors are not available for assessment via
BCS
Special attention account, returned cheques
incidences, previous defaulted loan under directors
related company
Business activity described as manufacturing but
financials shows no plant & machinery


GROUP EXPOSURE AND DA
MORE DA EXAMPLES
RM1.53M BPL financing is within Centre level of authority
Appeal solely on pricing reduction. BC is to obtain approval from the Head of
Commercial Banking via CCZ (fka CMC).
Request for reduction in pricing. Unsecured of RM3.29Mil per borrower should be
under CBCC level of authority
Prop value rose by RM600K from RM1.9M to RM2.5Mil (verbal) within 5 months
during current uncertain economic condition, reducing clean to RM1.7M.
Proposed limit: RM10M, SPA (09/01/2012): RM7.68M, EMV: RM13.8M
What is the clean exposure? NIL or clean RM2.3M
Answer: Per CIMB Group Framework for Valuation of Real Estate Property
Section 2.1.6, in the event of market values received from the independent
checks differs from the value stated in SPA, the approving authority will adopt the
lowest value available as the market value of the property.
MISREPRESENTATION OF INFORMATION
NON STANDARD CLAUSE IN BG FORMAT
DECISION
To allow the benefit of guarantee to be assigned by LLM (under clause 7 of
the said BG and agreed by BG Hub, GIOD TPC) (Please refer to BG Hub
email comments dated 28/02/2012 attached)
RATIONALE
Our BG Hub had vetted the contents of the said BG and of view the
assignment of BG as per item 2 above, will not heighten the banks risk
exposure
BG HUB EMAIL
Pls be informed that in order to issue this BG format, the following must be
obtained:
Approval from approving authority to allow the assignment of the BG
(Clause 7 of the BG)
As loan owner, BC should probe further on the need to have Clause 7, its
implications, mitigations and address all these in CA

MATERIAL DISCREPANCIES

To explain in detail the reasons for such serious discrepancies in the memo
instead of just amending the CR09
INTEREST RATE COMMENCEMENT DATE
UNNECCESSARY MISTAKES
WRONG SPELLING OF NAME
BCC, on 12 Jan 2012, approved additional facilities of RM5.7M making a
new limit of RM7.25M.
BC has notified that the name of one of the guarantors should be Soh
Chee Khong instead of Soh Chee Kong.
OMISSION OF EARLY SETTLEMENT CLAUSE
CBCC, on 15 Mar 2012, approved CL-i RM800K, TF-i of RM1.6M and
MOL-i of RM3.2M. However, BC has overlooked the early settlement
clause for TF-i.
a) BNM Sector Code (should be same in AA and ICRES)
b) Entity Code - B,I,G,F and L
c) Risk Weight / BG Tenure / BG pricing-to tier pricing if >24 months
d) Security CoverFor CPG (x). For property - no longer 60% use 100%
e) Property details - Type/Remaining Lease / Land & Built Up Area / Postal
Address
f) Latest value / Date / Panel Valuer / verbal / formal
g) Specify whether to impose or waive formal valuation after 2 years.
MORE POINTS
CHALLENGES
1. Borrowings with other banks Type, Limit, O/S, Collateral.
2. CCRIS Summary Page not enclosed
3. Financial analysis i.e. unusual numbers / irregular trends /
capital leakages / intangibles / contingent liabilities/debtors ageing etc
4. To align Group Review
5. Compliance financial covenants e.g. Gearing covenant (to highlight in AA
during renewal / request for additional limits.)
6. Compliance product eligibility criteria e.g. BPL / FSMI2 / SAGS etc
7. Amendments/Appeal AA ensure approval terms are stated
8. Highlight connected party relationship and position and job functions of
staff
9. No relieve officer to attend to queries
1. Sinking fund not collected & up to date.
2. Contract proceeds not collected.
3. Approvals for reduction in borrowers limit, changing of terms were not
adhered to by SBUs. Instead of sending the Borrower a letter of
notification, SBUs send a letter of offer which Borrower does not accept.
4. Compliance of covenants not checked.
5. CGC guarantee expired / almost expired and not renewed.
6. Is actual security documents intact? (instead of relying only on system).
7. As BCM/CRM/BCT relied on the spreadsheet provided by SBU to
conduct our analysis, is the spreadsheet filled up accurately?
CONCERNS
Q & A
CONTACT BCT
EVALUATOR TEL NO
Cinsy Choy Soek
See
03 - 2619 1946
Carmen Chin 03 - 2619 2014
Teh Chooi Eng 03 - 2619 2006
Voon Siew Peng 03 - 2619 2007
Chong Mei Jin 03- 2619 2807
Alinis Delina Ahmad 03-2619 1112
Elicia Cheah Suan Ee 03 - 2619 2010
Chuah Han Beng 03 - 2619 2011
Lim Hong Keow 03 - 2619 2012
CREDIT MANAGER TEL NO
Lim Ai Lean 03 - 2619 2020
Ramanathan a/l
Annamalai Chettiar
03 - 2619 3313
Lim Liang Hoe 03 - 2619 1198
Yong Ee-Lin 03 - 2619 2008