In line with its approved Terms of Reference, the Committee should meet at least once every quarter. During the year under review, the Committee met 6 times.

Composition:

The Committee shall consist of at least three members.

Membership as at 30 June 2020:

With the exception of the CEO, the membership of the Committee shall be appointed by the Board from amongst the Non-Executive Directors and of at least one Independent Director of the Bank with a reasonable number should have an adequate familiarity with risk management of the Bank. As at 30 June 2020, the Committee was in adherence with the membership rudiments.

Current recomposed membership:

Fundamental functions comprise:

• The main focus of the Committee shall also be to ensure that the bank maintains a satisfactory liquidity and solvency ratio at all times;
• Reviewing the principal risks and have a global view on all risks which the bank is exposed which includes but not limited to credit, market, liquidity, operational, legal, compliance and reputational risks and the actions taken to mitigate the risks;
• Requirement of the Head of Risk to provide regular reports to the Committee, senior management and the Board on his/her activities and findings relating to the Bank’s risk appetite framework;
• Formulating and making recommendations to the Board in respect of risk management issues including limits setting and risk appetite framework, which is well understood throughout the Bank. All corporate, operational, and financial policies should support the framework, which should be forward-looking and consistent with the Bank’s short-term and long-term strategic plan. The framework should set benchmarks as to the acceptable risk limits, taking into account relevant financial, operational, and macroeconomic factors;
• Receiving periodic information on risk exposures and risk management activities from senior officers;
• Ensuring that the CEO facilitates training programmes for Directors and senior management to enable them to have a robust understanding of the nature of the business, the nature of the risks, the consequences of the risks being inadequately managed and the techniques for managing the risks effectively;
• Reviewing and approving discussions and disclosure of risks;
• Providing prior endorsement for appointment and removal of the Head of Risk who, among other things, shall provide assurance that the oversight of risk management is independent from operational management and is adequately resourced with proper visibility and status in the Bank;
• Ensuring independence of the Head of Risk from operational management without any requirement to generate revenues;
• Monitoring of large credits, impaired credits and the overall level of provisioning; and
• Reviewing of Restructured facilities which shall be approved by the sanctioning authority (one level higher) than the initial approver.