A N N U A L   R E P O R T   2 0 1 9
PNB remains focused on our
 mandate of delivering sustainable
 returns to our unit holders despite
 the challenging economic climate.

 Profitability and sustainability can
   reinforce each other. Business
should do well, do right and do good
 – and it pays beyond just numbers.

  We approach investments with a
  clear forward vision. We focus on
 sustainable long-term returns, and
  we believe that for businesses to
   thrive, the societies in which we
        operate must thrive too.

 OVERVIEW                                                   ASNB’S TRANSFORMATION JOURNEY                      ORGANISATIONAL CAPABILITY

 4    Who We Are                                            70   ASNB’s Strategic Plan 2018-2022               76   Key Statistics: Human Capital
 5    Corporate Information                                      -   Expansion of Digital Reach                77   Training & Development
 6    Organisation Structure                                     -   Expansion of Agent Network                80   5-Year Technology Blueprint
 8    Our Value Chain                                            -   Branch Transformation                     81   Cultivating Innovation
 10   2019 Milestones                                            -   Establishment of Outsourced Call Centre
 12   Key Financial Highlights                                   -   Financial Literacy & Education

                                                                                                               SOCIAL OBJECTIVES
                                                                                                               84   Corporate Social Responsibility Report
 18   Board of Trustees of Yayasan                                                                             98   Uplifting the Bumiputera Community
      Pelaburan Bumiputra
 20   Board of Directors
 28   PNB Leadership Team
                                                                                                               CORPORATE GOVERNANCE

                                                                                                               102 Statement on Corporate Governance
 MESSAGE                                                                                                       112 Statement on Risk Management and
                                                                                                                    Internal Control
 34   Message from the Group Chairman
                                                                                                               121 Statement on Corporate Compliance
 40   The President & Group Chief Executive’s
                                                                                                                    and Integrity
                                                                                                               125 Audit Committee Report
                                                                                                               128 Shariah Advisory Committee Report


 50   Global Footprint, Investment Philosophy and Process                                                      FINANCIAL STATEMENTS
 52   Strategic Asset Allocation
 54   Strategic Investment                                                                                     131 PNB Group 5-Year Consolidated
 60   Private Investment                                                                                            Coterminous Proforma Financials
 62   Fixed Income                                                                                             132 Independent Auditors’ Report
 63   Real Estate                                                                                              133 Unit Trust Funds
 65   Merdeka 118
OVERVIEW                   PERMODAL AN NASIONAL BERHAD                                                                                                            PERMODAL AN NASIONAL BERHAD                                 OVERVIEW

    WHO WE ARE                                                                                          CORPORATE INFORMATION

                                                                                                                                                                        BOARD OF DIRECTORS

    To be a Distinctive World Class                                                                          1   Tan Sri Dr. Zeti Akhtar binti Aziz                 4   Tan Sri Datuk Zainun binti Ali            7    Dato Dr. Nik Ramlah
    Investment House                                                                                             Group Chairman                                                                                        binti Nik Mahmood

                                                                                                             2   Encik Abdul Jalil                                  5   Datuk Dr. Mohd. Yaakub                    8    Dato’ Johan bin Ariffin
                                                                                                                 bin Abdul Rasheed                                      bin Haji Johari
                                                                                                                 (Appointed with effect from 1 October 2019)
    MISSION                                                                Holder of Capital
                                                                           Markets Services                  3   Tan Sri Ahmad Badri                                6   Datu Haji Soedirman                       9    Dato’ Abdul Rahman bin Ahmad
                                                                           Licence for Fund                      bin Mohd. Zahir                                        bin Haji Aini                                  (Resigned on 30 September 2019)
    To enhance the economic wealth of                                        Management

    the Bumiputera community and
    all Malaysians, for the prosperity of                                                               NOMINATION AND REMUNERATION                            COMPLIANCE COMMITTEE                               SHARIAH ADVISORY COMMITTEE
    the nation                                                                Licensed Unit                                                                    1.   Tan Sri Datuk Zainun binti Ali                1.   Datuk Dr. Mohd. Daud bin Bakar
                                                                           Trust Management             1.   Tan Sri Dr. Zeti Akhtar binti Aziz                     (Chairman)                                         (Chairman)
                                                                                Company                      (Chairman)                                        2.   Encik Abdul Jalil bin Abdul Rasheed           2.   Tan Sri Dato’ Seri (Dr.) Haji Harussani
                                                                                                        2.   Datuk Dr. Mohd. Yaakub bin Haji Johari                 (Appointed with effect from 1 October 2019)        bin Haji Zakaria
    VA L U E S                                                                                          3.   Datu Haji Soedirman bin Haji Aini                 3.   Dato Dr. Nik Ramlah binti Nik Mahmood         3.   Dato’ Haji Mohamad Shukri
                                                                                                        4.   Tan Sri Ahmad Badri bin Mohd. Zahir               4.   Dato’ Abdul Rahman bin Ahmad                       bin Mohamad
                                                                                                             (Appointed with effect from 17 January 2019,           (Resigned on 30 September 2019)
                                                                                                                                                                                                                  4.   Dato’ As-Sheikh Haji Nooh bin Gadot
    Competence                                                                                               resigned with effect from 25 November 2019)
                                                                                                                                                                                                                  5.   Prof. Emeritus Dato’ Dr. Mahmood
                                                                                                                                                               TENDER COMMITTEE
    We possess the competency to                                                                                                                                                                                       Zuhdi bin Ab. Majid
                                                        FIXED PRICE UNIT          VARIABLE PRICE UNIT   INVESTMENT COMMITTEE                                                                                      6.   Dr. Aida binti Othman
    deliver high performance                                                                                                                                   1.   Datuk Seri Dr. Nik Norzrul Thani
                                                          TRUST FUNDS                TRUST FUNDS                                                                                                                  7.   Dato’ Idris bin Kechot
                                                                                                        1.   Tan Sri Dr. Zeti Akhtar binti Aziz                     bin N. Hassan Thani
                                                                                                                                                                                                                       (Appointed with effect from 7 August 2019)
                                                                                                             (Chairman)                                             (Chairman)
    Humility                                                                                            2.   Encik Abdul Jalil bin Abdul Rasheed               2.   Encik Abdul Jalil bin Abdul Rasheed
                                                                                                             (Appointed with effect from 1 October 2019)            (Appointed with effect from 1 October 2019)   REGISTERED OFFICE
    We treat people with mutual respect,                                                                3.   Datuk Seri Dr. Nik Norzrul Thani                  3.   Dato Dr. Nik Ramlah binti Nik Mahmood
                                                                                                                                                                                                                  Permodalan Nasional Berhad
    stay grounded to our roots, always                                                                       bin N. Hassan Thani                               4.   Dato’ Abdul Rahman bin Ahmad
                                                                                                                                                                    (Resigned on 30 September 2019)
                                                                                                                                                                                                                  Level 4, Balai PNB
                                                                                                        4.   Datuk Dr. Mohd. Daud bin Bakar
    cognisant that we serve a greater                                                                                                                                                                             201-A, Jalan Tun Razak
                                                                                                        5.   Dato’ Johan bin Ariffin
    purpose                                                                                                                                                    PROPERTY INVESTMENT COMMITTEE                      50400 Kuala Lumpur
                                                                                                        6.   Dato’ Abdul Rahman bin Ahmad
                                                                                                             (Resigned on 30 September 2019)
                                                                                                                                                                                                                  Tel: 03-2050 5100
                                                                                                                                                               1.   Tan Sri Dr. Zeti Akhtar binti Azi             Fax: 03-2050 5268
    Integrity                                                                                                                                                       (Chairman)
                                                                                                        AUDIT COMMITTEE
                                                                                                                                                               2.   Encik Abdul Jalil bin Abdul Rasheed           AUDITORS
    We will not compromise on integrity                                                                 1.   Datuk Mohd. Anwar bin Yahya                            (Appointed with effect from 1 October 2019)

    and we are committed to the highest                                                                      (Chairman)                                        3.   Datuk Seri Dr. Nik Norzrul Thani              Messrs Hanafiah Raslan & Mohamad PLT
                                                                                                        2.   Datuk Seri Dr. Nik Norzrul Thani                       bin N. Hassan Thani
    level of ethical conduct                                                                                                                                   4.   Datuk Dr. Mohd. Daud bin Bakar                BANKERS
                                                                                                             bin N. Hassan Thani
                                                                                                        3.   Dato Dr. Nik Ramlah binti Nik Mahmood             5.   Dato’ Johan bin Ariffin
                                                                                                                                                               6.   Dato’ Abdul Rahman bin Ahmad                  Maybank Islamic Berhad
    Prudence                                                                                                                                                        (Resigned on 30 September 2019)               Malayan Banking Berhad
                                                                                                        RISK MANAGEMENT COMMITTEE
    We are focused in safeguarding our
                                                                                                        1.   Dato Dr. Nik Ramlah binti Nik Mahmood             APPEAL COMMITTEE
    unit holders’ wealth                                                                                     (Chairman)
                                                                                                        2.   Datuk Seri Dr. Nik Norzrul Thani                  1.   Tan Sri Datuk Zainun binti Ali
                                                                                                             bin N. Hassan Thani
    Passion                                                                                             3.   Datuk Mohd. Anwar bin Yahya                       2.   Tan Sri Ahmad Badri bin Mohd. Zahir
                                                                                                                                                               3.   Datuk Dr. Mohd. Yaakub bin Haji Johari
    We are passionate in our task to                                                                                                                           4.   Datu Haji Soedirman bin Haji Aini
    achieve beyond the ordinary

4                                                                                                                                                                                                                                                   ANNUAL REPORT 2019   5
OVERVIEW                               PERMODAL AN NASIONAL BERHAD                                                                                                                                PERMODAL AN NASIONAL BERHAD                           OVERVIEW

    ORGANISATION STRUCTURE                                                                                                                                                                                                                                  ORGANISATION STRUCTURE

                                                                                                                                                      BOARD OF DIRECTORS

                                                                                                                                                        Group Chairman
                                                                                                                                                        TAN SRI DR. ZETI AZIZ

                                                                                                                                                          President &
                                                                                                                                                      Group Chief Executive
                                                                                                                                                          JALIL RASHEED                Company Secretary & Legal                      Risk Management             Compliance & Integrity

                                                                                                                                                                                             Company Secretary                        Internal Assurance                  Compliance

         Shariah Management                       Public Affairs                             Treasury                         Strategy
                                                                                                                                                                                                    Legal                                                                   Integrity

                                                 PNB Research Institute                                                     Corporate Strategy
                                                     Sdn Berhad

                                                                                                                         Strategic Asset Allocation


              Public Markets                                                          Strategic Investments                Private Markets                   Real Estate                      Technology                             Group Finance                      Unit Trust

                                                                                                                                                                                                                                                                        Sales & Channel
                                                                                          Banking & Insurance               Direct Investments            Real Estate Investment                 IT Security                                Finance
    Fund Management                                    Economics
                                 Analysis                                                  Industrial & Motors           Global Fund Investments                                             IT Business Analyst                                                     Unit Trust Strategy &
                                                                                                                                                            Global Real Estate &                                                         Procurement
                                                                                                                                                                                                                                                                     Product Management
         ASB Funds               Consumer                Asia-Pacific                                                                                        Funds Investment
                                Discretionary                                             Plantation, Healthcare
                                                                                                  & Telco                                                                                                                           Investment Processing              Customer Service
                                                                                                                                                                                             Management Office
         ASM Funds                                       Developed                                                                                      Real Estate Special Projects
                               Communications            Economies                          Energy, Utilities &
                                                                                             Infrastructure                                                                                  Technology Support                      Property Operations            Branch Management &
         ASN Funds
                                 Healthcare             Commodities                                                                                        Facilities Management                  Services                                                               Supervision
                                                                                         Property & Construction
         Proprietary                                                                                                PNB Development Sdn Berhad                                                                                     Project Management
            Fund                 Financials           Foreign Exchange                                                                                     Development Assets –             Business Application                                                    Preferred Client & Agent
                                                           & Rates                                                                                              PNB 1194                         Systems                                                                 Management
                                                                                         Corporate Governance       PNB Commercial Sdn Berhad
            Global                                                                                                                                                                                                                Property Maintenance
                               Equity Strategy
      Strategy & Foreign                              Equity Market                                                                                                                                                                                                   Business Solutions
                                                                                                                       PNB Merdeka Ventures                                               IT Architecture & Strategy
          Exchange                                     Operations
                               Credit Analysis                                                                             Sdn Berhad                                                                                                General Services
                                                                                                                                                                                                                                                                         Unit Holders
         Outsourced                                                                                                                                                                       Core Application Systems
                                                      Fixed Income                                                                                                                                                                                                    Communications &
           Funds                  Business                                               Human Capital                Listed REIT (Pelaburan                                                                                             Security                     Financial Education
                               Process & Data                                                                        Hartanah Nasional Berhad)
                                Management                                                                                                                                                 IT Service Management
                                                                                      Human Capital Planning &                                                                                                                                                      Unit Trust Operations &
                                                                                                                          Attana Hotels &
                                                                                          Development                                                                                                                                                               Record Administration
      Division                                                                                                           Resorts Sdn Bhd
      Operating Subsidiary                                                                Human Resource                                                                                                                                                             Marketing & Publicity
                                                                                      Operations & Administration

6                                                                                                                                                                                                                                                                             ANNUAL REPORT 2019   7
OVERVIEW                           PERMODAL AN NASIONAL BERHAD                                                                                                                     PERMODAL AN NASIONAL BERHAD                                    OVERVIEW

    OUR VALUE CHAIN                                                                                                                                                                                                                                OUR VALUE CHAIN

             Unit holders invest in                                             PNB manages the investments of the                                                     Investments are made across a diversified portfolio of asset
              ASNB’s products                                                           unit trust funds                                                                   classes and geographies to manage risk exposure

                                                                PNB RUNS A ROBUST END-TO-END PROCESS FOR
                                                                          INVESTMENT SELECTION

                                                                                                        Due Diligence,
                                                                                                                                 Selection of
                                                           Objective                  Idea                Analysis,
                                                            Setting                 Generation           Forecast &
                                                                                                          Valuation                                                                                    Global
                                                                                                                                                                                 Commodity             Trade
                                                                                                                     Monitoring                                                    Prices                                     GDP
                                                                                               Executive              Review,                                                                                                Growth
                                                                                                & Active            Rebalancing,
       Fixed Price Unit Trust Funds                                 Construction
                                                                                              Management            Monetisation
                                                                                                                       & Exit
                                                                                                                                                                                                 Real                                          Market
                                                                                                                                                                                                Estate                                       Sentiments
                                                            WITH AN EFFECTIVE GOVERNANCE OPERATING MODEL                                                                                                             Private
                                                           Business Units          Leadership Team       Investment Committees       Board

                                                             President & Group                             Unit Trust Fund Investment                          Trust                                                                              Currency
                                                              Chief Executive                                                                                                                 INVESTMENT                     Public
                                                                                                                   Committee                                   Deed                                                                              Movements
                                                                                                                                                                                               PORTFOLIO                     Equity
      Variable Price Unit Trust Funds
                                                           Asset Management                                                                        Board
                                                         Strategic Business Units                         PNB Investment Committee              of Directors

                                                                                                                                                                                                                          Fixed                Interest
                                                                 Fixed Price      Variable Price
                                                 Proprietary                                                Compliance Committee                 Investment                                                              Income                 Rates
                                                                  Unit Trust        Unit Trust
                                                    Fund                                                                                        Management
                                                                    Funds             Funds
                                                                                                                                                 Agreement                                       Cash

                                                                                                               Audit Committee
                                                               Group Assurance

                                                   Financial &                                                                                     Board                          Corporate                Capital
                                                                               Compliance                Risk Management Committee
                                                                                                                                                of Directors                      Earnings
                                                Management Audit                                                                                                                                           Flows

                                                                                                         Other PNB Board Committees
                                                      Risk Management Department

                                                                                         REGULATED BY                                                                                 Performance of assets is
                                                      External Auditors                              Statutory Bodies                                                                driven by a combination of
                                                                                                                                                                                        macroeconomic and
                                                                                                                                                                                           market factors

       Enabling the sharing of corporate                            Annual income distribution to unit holders is derived                                               The returns of the portfolio are generated from realised
             wealth to unit holders                                        from the performance of the portfolio                                                        capital gains and recurring income from each asset class

8                                                                                                                                                                                                                                                             ANNUAL REPORT 2019   9
OVERVIEW                                     PERMODAL AN NASIONAL BERHAD                                                                                                                                  PERMODAL AN NASIONAL BERHAD                                 OVERVIEW

     2019 MILESTONES                                                                                                                                                                                                                                                          2019 MILESTONES

     JANUARY                                                   FEBRUARY                                    MARCH                                           APRIL                                       JUNE                                           JULY

                                                               Appointment of YBhg Datuk Mohd.
                                                               Anwar Yahya as ASNB new Board                                                               Official opening of Minggu Saham
                                                               of Director.                                PNB’s inaugural Leadership Forum which          Amanah Malaysia (MSAM) 2019 in                                                             Perdana Kuala Lumpur City Centre
                                                                                                           centred around key topics of “Organisational    Sungai Petani, Kedah. The annual event                                                     and Perdana Kota Bharu received the
     Appointment of YBhg Tan Sri Ahmad Badri                                                                                                               which reached its 20th edition in 2019,     Second PNB Leadership Forum with               “Platinum” rating by the Islamic Tourism
                                                                                                           Transformation” and “From Governance to
     Mohd. Zahir, YBhg Tan Sri Datuk Zainun Ali,                                                                                                           attracted some 163,000 visitors around      the topic "Positive Autocracy –                Centre, under the Ministry of Tourism,
     YBhg Dato Dr. Nik Ramlah Nik Mahmood and                                                                                                              Kedah, thereby reaching over 3.9 million    A Leadership Model for Industry 4.0".          Arts & Culture, for their Muslim-friendly
     YBhg Dato’ Johan Arifin to the PNB Board                                                                                                              visitors since MSAM was first incepted.                                                    Hospitality Services.
     of Directors.
                                                                                                                                    Completion of the
                                                                                                                                    joint acquisition of
                                                                                                                                    Battersea Power
                                                                                                                                    Station Phase II by
                         PNB Group became the                                                                                       PNB and EPF at a
                         largest shareholder in Sapura         The fifth ASNB Starz Awards was                                      total consideration
                         Energy with a 40% stake               held in appreciation and recognition                                 of £1.58 billion
                         subsequent to the completion          of ASNB agents’ contribution and                                     (RM8.35 billion).
                         of Sapura Energy's capital call       achievements.                                                                               Launch of myASNB mobile application
                         in January 2019.                                                                                                                  to cater to the needs of the younger                                                       Fiesta Labur PNB in Johor Bahru, Johor
                                                                                                           Commencement of outsourced programme            generation and provide greater                                                             was held to encourage unit holders to
                                                                                                           for Private Equity and Real Estate as part of   convenience and ease for unit holders                                                      update personal information, register
                                                                                                           the global asset diversification strategy.      to perform their transactions.                                                             to be a user of myASNB portal and
                                                                                                                                                                                                                                                      download myASNB mobile application.

     DECEMBER                                                  NOVEMBER                                                                                    OCTOBER                                     SEPTEMBER

                                                                                                                                                                                      of Encik Jalil
                                                                                                                                                                                      Rasheed as
                                                                                                                                                                                      President &
                                                                                                                                                                                      Group Chief

                                                                                                                                                                                                       Launch of PNB Kembara 2019 – the                YAB Prime Minister Tun Dr Mahathir
                                                                                                                                                           Completion of Strategic Asset               nationwide tour was organised to                Mohamad’s official visit to Battersea
     Retirement of YBhg Datin Paduka Kartini                                                                                                               Allocation's Mid-Term Review.
                                                               The YTI Memorial Lecture 2019, which                                                                                                    encourage unit holders to update their          Power Station, London, UK.
     Haji Abdul Manaf, Deputy President,                       was jointly organised by Yayasan Tun                                                                                                    personal information.
     Strategic Investment after over 36 years                                                              Completion of the disposal of Menara
                                                               Ismail Mohamed Ali (YTI) and PNB            AIMS to Time dotcom Group as part of a
     of service.                                               Research Institute Sdn Berhad (PNBRI),      capital recycling opportunity and strategic
                                                               focused on cultivating and enhancing        decision to rebalance PNB's overall real
                                                               resilience in a crisis situation, and the   estate portfolio.
                                                               importance of foresight skills in modern

                                                                                                                                                           PNB’s inaugural thought leadership forum                                                    Retirement of YBhg Dato’ Abdul Rahman
                                                                                                                                                           “PNB Corporate Summit 2019” with the        Official launch of Merdeka 118 Show             Ahmad as President & Group Chief
                                                                                                                                                           theme “Rebooting Corporate Malaysia”        Gallery at Jalan Sultan Ismail, Kuala           Executive upon completion of his
                                                                                                                                                           was officially opened by the then YAB       Lumpur by YBhg Tan Sri Dr. Zeti Aziz.           three-year tenure.
                                                                                                                                                           Prime Minister, Tun Dr. Mahathir Mohamad.

10                                                                                                                                                                                                                                                                                      ANNUAL REPORT 2019   11
OVERVIEW                      PERMODAL AN NASIONAL BERHAD                                                                                PERMODAL AN NASIONAL BERHAD                             OVERVIEW

     KEY FINANCIAL HIGHLIGHTS                                                                                                                                                            KEY FINANCIAL HIGHLIGHTS

      Assets Under Management                                          Units in Circulation                    Number of Accounts                            PNB Group 5-Year Consolidated
                                                                                                                                                             Coterminous Proforma Gross Income
      (RM billion)                                                     (billion units)                         (million)                                     (RM billion)

                                                                                                                                                                         18.8     17.5    20.4       20.3       15.1

                                         312.0                                                         253.8                                 14.3
                                         2019                                                          2019                                  2019
                                 298.5                                                                                                2018
                                 2018                                                          236.6                           13.2                                       2015    2016     2017      2018       2019
                                                                                               2018                     12.9   2017
                         279.2                                                                                   12.6   2016
                         2017                                                          219.3                     2015
                 2016                                                          211.6   2017                                                                  PNB Group 5-Year Consolidated
       254.6                                                                   2016                                                                          Coterminous Proforma Net Income
       2015                                                            202.5
                                                                       2015                                                                                  (RM billion)

                                                                                                                                                                         15.6     15.2    17.7       17.0       10.7

                                                                                                                                                                          2015    2016     2017      2018       2019

                                                                                                                                                             PNB Group 5-Year Consolidated
                                                                                                                                                             Coterminous Proforma Return on Assets

                                                                                                                                                                         6.3%     6.0%    6.7%       6.0%      3.5%

                                                                                                                                                                          2015    2016     2017      2018       2019

12                                                                                                                                                                                                              ANNUAL REPORT 2019   13
OVERVIEW             PERMODAL AN NASIONAL BERHAD                                                                                                                              PERMODAL AN NASIONAL BERHAD                                           OVERVIEW

     KEY FINANCIAL HIGHLIGHTS                                                                                                                                                                                                                KEY FINANCIAL HIGHLIGHTS

     PNB Group Asset Allocation by Asset Class                                                                  Performance of the Unit Trust Funds

                              2019                                                       2018

        13.4% ”                                                    17.4%                                         Financial Year End (FYE)                                         31 Dec            31 Mar              30 Jun             31 Mar           31 Aug             30 Sep
        Cash & Money Market                    0.5% “                                                0.3%
                                                                   Cash & Money Market
                                                  Others                                              Others     Distribution (sen per unit)                                     5.0 + 0.5            6.0              4.85 + 0.4            5.5             5.0                5.0
        6.4% n                                                     6.5%
        Fixed Income                                               Fixed Income
                                                                                                                 Net income (RM million)                                          5,821.5            610.8               233.8             1,076.7          867.0              731.4
                                                                                                                 Units in circulation FYE (billion units)                          167.2              10.4                6.2               19.5             21.7               13.7
        3.4% “                                                     2.8%
                                              68.0% ”                                               69.1%
        Real Estate                                                Real Estate
                                               Domestic                                            Domestic                                                                                                                          Mixed Asset                   Mixed Asset
        2.4% “                              Public Equity          2.2%                         Public Equity
                                                                                                                                                                                           Equity                                     Balanced                     Conservative
        Private                                                    Private
        Investments                                                Investments

        5.9% “                                                     1.7%
        International                                              International
        Public Equity                                              Public Equity
                                                                                                                 Financial Year End (FYE)                          31 Dec         30 Jun         31 Mar         30 Sep           30 Nov            31 Mar     31 Mar           30 Sep
                                                                                                                 Distribution yield (%)                              4.35           5.04            4.44          4.06              4.54            4.59       4.57              4.26
                                                                                                                 Total return (%)                                    1.74           1.20          -6.27          -3.89              3.62           -2.25       0.13              2.79
                                                                                                                 Net income* (RM million)                            49.4           43.2          124.2           15.9              58.7            40.5       82.1              49.3
     PNB Group Asset Allocation by Geography
                                                                                                                 Units in circulation FYE
                                                                                                                                                                      1.8            1.5            2.6            0.4              1.3              1.3           1.6            1.1
                                                                                                                 (billion units)
                              2019                                                       2018
                                                                                                                * Realised portion of total comprehensive income, including Distribution Equalisation Reserve (DER).

        8.5% “                                                     3.3%
        International                                              International
                                                                                                                Income Distribution (RM billion)
            70%                                                        50%                                      Cumulative Income Distribution                                                        Annual Income Distribution Payout
        •   Public Equity                                          •   Public Equity

            14%                                                        12%
        •   Real Estate                                            •   Real Estate

            4%                                                         1%
                                                                                                                                                                 200.2                                                                             15.0
                                                                                                                                                                 2019                                                                14.6          2018
        •   Private                                                •   Private                                                                        187.1                                                   14.2        13.9       2017
            Investments                       91.5% ”                  Investments                  96.7%                                             2018                                                    2015        2016                              13.2
            12%                                Domestic                37%                         Domestic
        •   Cash                                                   •   Cash



14                                                                                                                                                                                                                                                                       ANNUAL REPORT 2019   15
18 Board of Trustees of Yayasan Pelaburan Bumiputra

20 Board of Directors

28 PNB Leadership Team

     BOARD OF TRUSTEES OF                                                                       BOARD OF TRUSTEES OF
                                                                                         YAYASAN PELABURAN BUMIPUTRA

     YAB TAN SRI                                                                           YB SENATOR
     DATO' HJ.                                                                             TENGKU DATO'
     MUHYIDDIN                                                                             SRI ZAFRUL
     HJ. MOHD.                                                                             TENGKU
     YASIN                                                                                 ABDUL AZIZ
     CHAIRMAN OF YPB/PRIME                                                                 DEPUTY CHAIRMAN OF
     MINISTER OF MALAYSIA                                                                  YPB/MINISTER OF FINANCE

     YBHG TAN SRI                                                                          YBHG TAN SRI
     DR. ZETI AZIZ                                                                         HAJI AMBRIN
     GROUP CHAIRMAN OF PNB                                                                 BUANG

18                                                                                                             ANNUAL REPORT 2019   19
LEADERSHIP                         PERMODAL AN NASIONAL BERHAD                                                                                                                   PERMODAL AN NASIONAL BERHAD                               LEADERSHIP

     BOARD OF DIRECTORS                                                                                                                                                                                                                     BOARD OF DIRECTORS

                                                                Qualification        -   PhD in Economics from University of Pennsylvania,                                                      Qualification           -   Bachelor of Science (Honours) in Accounting and
                                                                                         USA                                                                                                                                Finance from the London School of Economics
                                                                                     -   Bachelor of Science in Economics from University                                                                                   and Political Science, UK
                                                                                         of Malaya

                                                                                                                                                                                                Directorship            -   Chairman of Sapura Energy Berhad and Projek
                                                                Directorship         -   Chairman of Amanah Saham Nasional Berhad and                                                                                       Lintasan Kota Holdings Sdn Bhd (PROLINTAS)
                                                                                         Sime Darby Property Berhad                                                                                                     -   Amanah Saham Nasional Berhad (ASNB) and
                                                                                                                                                                                                                            Pelaburan Hartanah Nasional Berhad (PHNB)

                                                                Other Information    -   Co-chair, Board of Governors of Asia School of
                                                                                         Business, established in collaboration with                                                            Working Experience      Abdul Jalil was appointed as the President &
                                                                                         MIT Sloan                                                                                                                      Group Chief Executive and Director of PNB on
                                                                                                                                                                                                                        1 October 2019. He joined Invesco in 2013 as
                                                                                     Tan Sri Dr. Zeti was appointed as the Group Chairman                                                                               Chief Executive Officer (CEO), South East Asia &
                                                                Working Experience
                                                                                     of PNB on 1 July 2018. Prior to the appointment,                                                                                   Head of Emerging Markets Group. He led the firm’s
                                                                                     Tan Sri Dr. Zeti had served as Governor of Bank                                                                                    business activities across the region and investment
                                                                                     Negara Malaysia from May 2000 to April 2016. She                                                                                   strategy in all asset classes across emerging
                                                                                     had an important role in managing the resolution of                                                                                markets. He was also a member of Invesco’s Global
                                                                                     the financial system in 1998 during the Asian financial                                                                            Investment Committee, responsible for investment
                                                                                     crisis and the consequent strong recovery of the                                                                                   strategy, product development, corporate governance
                                                                                     Malaysian economy. She was also instrumental in                                                                                    and talent development.
                                                                                     transforming Malaysia’s financial system, including
                                                                                     overseeing the enactment of 12 new pieces of                                                                                       Prior to joining Invesco, he spent 10 years with
                                                                                     legislation for the financial sector. During this period,                                                                          Aberdeen Asset Management in various investment
                                                                                     the Malaysian financial system also underwent a                                                                                    leadership roles. His last position was CEO of
                                                                                     period of progressive liberalisation.                                                                                              Aberdeen Islamic Asset Management, based in Kuala
                                                                                                                                                                                                                        Lumpur, where he established and managed the firm’s
                                                                                     In Asia, Tan Sri Dr. Zeti was active in strengthening                                                                              investment desk and developed the overall Malaysian
                                                                                     cooperation and regional financial integration. In 2006,                                                                           and global Shariah business.
                                                                                     she chaired the regional task force that prepared
                                                                                     the report for the future direction of central bank
                                                                                     financial cooperation in the East Asian region. At the
                                                                                     Bank for International Settlements (BIS), she was the
                                                                                     chair of the BIS Central Bank Governance Group. In
                                                                                     the region, she was a founding member of the Bank
                                                                                     for International Settlements (BIS) Asian Consultative
                                                                                     Council, and was the first Co-chair of the Financial
                                                                                     Stability Board Regional Consultative Council Group

               TAN SRI DR. ZETI                                                      for Asia. Tan Sri Dr. Zeti also had an extensive role in
                                                                                     the global development of Islamic finance, and was
                                                                                                                                                 ABDUL JALIL
               AKHTAR AZIZ                                                           active in the global financial inclusion agenda. She has
                                                                                     been an important voice for the emerging world on
                                                                                                                                                 ABDUL RASHEED
                                                                                     the many issues concerning the international financial
               Group Chairman                                                                                                                    President & Group Chief Executive
                                                                                     system and on financial and economic management.

               Position: Non-Independent Non-Executive Director                                                                                  Position: Non-Independent Executive Director

               Age: 73                                                                                                                           Age: 37

               Date of Appointment: 1 July 2018                                                                                                  Date of Appointment: 1 October 2019

20                                                                                                                                                                                                                                                          ANNUAL REPORT 2019   21
LEADERSHIP                         PERMODAL AN NASIONAL BERHAD                                                                                                                  PERMODAL AN NASIONAL BERHAD                                LEADERSHIP

     BOARD OF DIRECTORS                                                                                                                                                                                                                        BOARD OF DIRECTORS

                                                                    Qualification        -   Master of Business Administration from University                                                     Qualification           -   Master of Laws degree (LLM) (Cantab) from
                                                                                             of Hull, United Kingdom.                                                                                                          University of Cambridge, United Kingdom
                                                                                         -   Bachelor’s Degree (Honours) and Diploma in                                                                                    -   Bachelor of Laws (LLB) (Hons) from
                                                                                             Land and Property Management from University                                                                                      University of Malaya
                                                                                             Technology MARA (UiTM)

                                                                                                                                                                                                   Directorship            -   Chairman of Malaysia Airports Holdings Berhad
                                                                    Directorship         -   Chairman of Lembaga Hasil Dalam Negeri
                                                                                             Malaysia (LHDNM), Lembaga Pembiayaan
                                                                                                                                                                                                   Other Information       -   Member of the United Nations’ Advisory Board of
                                                                                             Perumahan Sektor Awam (LPPSA), Kumpulan
                                                                                                                                                                                                                               the Global Judiciary Integrity Network
                                                                                             Wang Persaraan (KWAP), Cyberview Sdn Bhd and
                                                                                             Tenaga Nasional Berhad (TNB)
                                                                                         -   Bank Negara Malaysia, Lembaga Tabung Haji                                                             Working Experience      Tan Sri Datuk Zainun was appointed as a member of
                                                                                             (LTH) and Perbadanan Insurans Deposit Malaysia                                                                                the Board of Directors of PNB on 1 January 2019, after
                                                                                                                                                                                                                           having served the Government in various capacities
                                                                                                                                                                                                                           in the Legal and Judicial Services since 1976. After
                                                                    Other Information    -   Member of Investment Panel for Kumpulan Wang                                                                                  her stint as Legal Adviser to Ministries which included
                                                                                             Simpanan Pekerja (KWSP)                                                                                                       her service as the Registrar of Companies and Chief
                                                                                                                                                                                                                           Registrar of the Federal Court, she was elevated to
                                                                                                                                                                                                                           the Bench in 1996 as a High Court Judge. She was
                                                                    Working Experience   Tan Sri Ahmad Badri was appointed as a member of
                                                                                                                                                                                                                           subsequently promoted to the Court of Appeal Bench
                                                                                         the Board of Directors of PNB on 1 January 2019. He
                                                                                                                                                                                                                           and later reached the apex court in 2012, as a Federal
                                                                                         is currently the Secretary General of Treasury, Ministry
                                                                                                                                                                                                                           Court Judge.
                                                                                         of Finance. Prior to this, he was the Deputy Secretary-
                                                                                         General (Management) of Treasury.

                                                                                         He has served for almost thirty one (31) years in the
                                                                                         Ministry of Finance, holding several senior positions,
                                                                                         including the Director of the National Budget Office
                                                                                         and Under Secretary of Strategic Investment Division.
                                                                                         He had been appointed as an Adviser for Asian
                                                                                         Development Bank (ADB) in Manila, the Philippines.

                   TAN SRI AHMAD                                                                                                                    TAN SRI DATUK
                   BADRI MOHD. ZAHIR                                                                                                                ZAINUN ALI
                   Position: Independent Non-Executive Director                                                                                     Position: Independent Non-Executive Director

                   Age: 60                                                                                                                          Age: 67

                   Date of Appointment: 1 January 2019                                                                                              Date of Appointment: 1 January 2019

22                                                                                                                                                                                                                                                               ANNUAL REPORT 2019   23
LEADERSHIP                         PERMODAL AN NASIONAL BERHAD                                                                                                                 PERMODAL AN NASIONAL BERHAD                                 LEADERSHIP

     BOARD OF DIRECTORS                                                                                                                                                                                                                        BOARD OF DIRECTORS

                                                                    Qualification        -   PhD in Sociology from University of Salford, United                                                  Qualification           -   Fellow of the Association of Chartered Certified
                                                                                             Kingdom                                                                                                                          Accountants (UK)
                                                                                         -   Master of Science (Liberal Studies) from University                                                                          -   Chartered Accountant (Malaysia) of Malaysian
                                                                                             of Manchester, United Kingdom                                                                                                    Institute of Accountants (MIA)
                                                                                         -   Bachelor of Science (Honours) from University of
                                                                                             Sussex, United Kingdom
                                                                                                                                                                                                  Directorship            -   Sarawak Plantation Bhd, Sarawak Consolidated
                                                                                                                                                                                                                              Industries Berhad, Amanah Saham Sarawak
                                                                    Working Experience   Datuk Dr. Mohd. Yaakub began his career as a                                                                                         Berhad, Sara Worldwide Vacations Berhad and
                                                                                         part-time lecturer in Political Science at the MARA                                                                                  Damai Golf & Country Club Berhad
                                                                                         Institute of Technology and in 1983, he joined the
                                                                                         Sabah State Civil Service as an Assistant Director                                                                               Datu Haji Soedirman started his career with Petroliam
                                                                                                                                                                                                  Working Experience
                                                                                         (Research and Consultancy) in the Chief Minister’s                                                                               Nasional Berhad in 1982, and after serving 13 years
                                                                                         Department. He was made the Principal Assistant                                                                                  with the company, resigned in 1995, to join Sarawak
                                                                                         Director (Management Development) in 1984. He                                                                                    State Government.
                                                                                         joined the Institute of Development Studies, Sabah
                                                                                         (IDS), the State’s official think tank as an Associate                                                                           His recent position was as the General Manager
                                                                                         Director (Social Affairs) in 1985 and later moved up                                                                             of Sarawak Economic Development Corporation
                                                                                         to Deputy Chief Executive/Senior Research Fellow in                                                                              (SEDC) prior to his retirement on 31 December 2018.
                                                                                         1991-1994. He served as the Executive Director/Chief                                                                             His previous employment in the Sarawak Civil
                                                                                         Executive of the IDS for 15 years from 1994-2009 prior                                                                           Service includes being the Permanent Secretary of
                                                                                         to his appointment in 2009, as the Chief Executive of                                                                            the Ministry of Social Development, Director of State
                                                                                         the Sabah Economic Development and Investment                                                                                    Implementation Monitoring Unit, Permanent Secretary
                                                                                         Authority (SEDIA).                                                                                                               of the Ministry of Industrial Development, Deputy State
                                                                                                                                                                                                                          Financial Secretary and State Accountant-General.
                                                                                                                                                                                                                          Between November 2002 and September 2003, he
                                                                                                                                                                                                                          was seconded to Amanah Saham Sarawak Berhad
                                                                                                                                                                                                                          as its Chief Executive Officer. He currently sits on
                                                                                                                                                                                                                          the Board of public listed companies and various
                                                                                                                                                                                                                          Government-Linked Companies and Non-Government

                   DATUK DR. MOHD.                                                                                                                 DATU HAJI SOEDIRMAN
                   YAAKUB HAJI JOHARI                                                                                                              HAJI AINI
                   Position: Independent Non-Executive Director                                                                                    Position: Independent Non-Executive Director

                   Age: 64                                                                                                                         Age: 64

                   Date of Appointment: 1 January 2017                                                                                             Date of Appointment: 1 January 2017

24                                                                                                                                                                                                                                                              ANNUAL REPORT 2019   25
LEADERSHIP                         PERMODAL AN NASIONAL BERHAD                                                                                                               PERMODAL AN NASIONAL BERHAD                                 LEADERSHIP

     BOARD OF DIRECTORS                                                                                                                                                                                                                      BOARD OF DIRECTORS

                                                                    Qualification        -   PhD in Law from University of London,                                                              Qualification           -   MBA (Marketing) from University of Miami,
                                                                                             United Kingdom                                                                                                                 Coral Gables, Florida, USA
                                                                                         -   Master of Laws from University of London,                                                                                  -   Bachelor of Arts Degree in Economics from
                                                                                             United Kingdom                                                                                                                 Indiana University, Bloomington Indiana, USA
                                                                                         -   Bachelor of Laws from University of Malaya

                                                                                                                                                                                                Directorship            -   Chairman of Pelaburan Hartanah Nasional Berhad
                                                                    Directorship         -   United Malacca Berhad, Axiata Group Berhad,                                                                                    (PHNB), Mitraland Group of Companies, Etiqa
                                                                                             Securities Industry Development Corporation                                                                                    Insurance Pte Ltd (Singapore) and Etiqa Life
                                                                                             (SIDC), Institute for Capital Market Research                                                                                  Insurance (Cambodia) Plc
                                                                                             Malaysia (ICMR) and International Centre for                                                                               -   Sime Darby Property Berhad, Etiqa Life Insurance
                                                                                             Education in Islamic Finance (INCEIF)                                                                                          Berhad, Etiqa Family Takaful Berhad, Etiqa
                                                                                                                                                                                                                            General Takaful Berhad and Maybank Ageas
                                                                                                                                                                                                                            Holdings Berhad
                                                                    Working Experience   Dato Dr. Nik Ramlah was appointed to the Board of
                                                                                         Directors of PNB on 1 January 2019, and Amanah
                                                                                         Saham Nasional Berhad on 1 January 2017. She                                                           Working Experience      Dato’ Johan started his career in the real estate
                                                                                         retired in March 2016, having worked at Securities                                                                             division of Citibank. Thereafter, he held various
                                                                                         Commission Malaysia (SC) for almost 23 years holding                                                                           senior positions in several subsidiaries of public listed
                                                                                         various positions from Manager for Law Reform to                                                                               companies while venturing into his own successful
                                                                                         Deputy Chief Executive. Throughout her years in the                                                                            marketing and advertising consultancy and property
                                                                                         SC, Dato Dr. Nik Ramlah has been directly involved                                                                             development business. He then headed Danaharta’s
                                                                                         in most areas of capital market development and                                                                                Property Division as Senior General Manager before
                                                                                         regulation, providing strategic and legal guidance                                                                             moving on to head TTDI Development Sdn Bhd up
                                                                                         in product and market development, bond market,                                                                                to January 2009. He also served on the Board of
                                                                                         fund management, corporate governance and Islamic                                                                              Maybank Berhad for nine years up to April 2018.
                                                                                         Finance. Prior to joining the SC, Dato Dr. Nik Ramlah
                                                                                         was an Associate Professor at the Faculty of Law,
                                                                                         University of Malaya, where she had also served as
                                                                                         Deputy Dean.

                   DATO DR. NIK RAMLAH                                                                                                           DATO’ JOHAN ARIFFIN
                   NIK MAHMOOD                                                                                                                   Position: Independent Non-Executive Director

                   Position: Independent Non-Executive Director                                                                                  Age: 61

                   Age: 64

                   Date of Appointment: 1 January 2019                                                                                           Date of Appointment: 1 January 2019

26                                                                                                                                                                                                                                                             ANNUAL REPORT 2019   27
LEADERSHIP                        PERMODAL AN NASIONAL BERHAD                                                                                          PERMODAL AN NASIONAL BERHAD            LEADERSHIP

     PNB LEADERSHIP TEAM                                                                                                                                                                                  PNB LEADERSHIP TEAM

     Sitting from left to right:
     Mohamad Idros Mosin, Rick Ramli, Dato’ Mohd. Nizam Zainordin                                             Sitting from left to right:
                                                                                                              Jalil Rasheed, Mohammad Hussin, Adibah Khairiah Ismail @ Daud
     Standing from left to right:
     Fairuz Suzana Hj Kamaruddin, Noramly Bachok @ Abdul Aziz, Aida Md Daud, Fadzihan Abbas Mohamed Ramlee,   Standing from left to right:
     Dr Ahmad Basri Ibrahim, Hanizan Hood                                                                     Muzzaffar Othman, Hafizuddin Sulaiman, Suzana Ahmad, Aziz Anuar, Mohd Irwan Ahmad Mustafa

28                                                                                                                                                                                                                     ANNUAL REPORT 2019   29
LEADERSHIP                                         PERMODAL AN NASIONAL BERHAD                                                                                                                                                                       PERMODAL AN NASIONAL BERHAD                                         LEADERSHIP

     PNB LEADERSHIP TEAM                                                                                                                                                                                                                                                                                                    PNB LEADERSHIP TEAM

           JALIL RASHEED                                                                        DATO’ MOHD. NIZAM ZAINORDIN                                                        HAFIZUDDIN SULAIMAN                                     ADIBAH KHAIRIAH ISMAIL @ DAUD                         AZIZ ANUAR
           President & Group Chief Executive                                                    Deputy President & Group Chief Financial Officer                                   Group Head, Treasury                                    Group Head, Company Secretary & Legal                 Group Head, Public Affairs
           Steers the overall investment, financial, operational and strategic direction of     Leads and directs PNB’s financial planning, budgeting, reporting and recovery      Leads and manages the overall capital and liquidity     Oversees and leads PNB’s company secretarial          Spearheads the Public Affairs Division which
           PNB to ensure business growth and sustainability in achieving the mandate            processes, in addition to overseeing all procurement policies and processes        management of the business and its correlated           and legal functions, provides company secretarial     encompasses the departments of Communications
           of enhancing the economic wealth of the Bumiputera community and all                 towards ensuring PNB possesses the financial strength and sustainability to        activities such as liability management, fund raising   services to PNB and its related companies as well     and Education, whilst leading research efforts
           Malaysians. Ensures implementation of the company’s vision and mission to            execute the company’s Strategic Plan and overall business operations.              and implements appropriate Treasury policies with       as administers the business processes related         through PNB Research Institute Sdn. Berhad.
           safeguard the long-term interests of shareholders, unit holders, employees and                                                                                          the objective of maintaining an optimum Treasury        to Company Secretary’s Department and Legal           Wholly responsible for formulating and executing
           other stakeholders.                                                                                                                                                     operations and cost efficient capital structure for     Department.                                           dynamic corporate branding initiatives, building
                                                                                                                                                                                   the Group.                                                                                                    strong stakeholder relations, developing highly-skilled
                                                                                                                                                                                                                                                                                                 talent pool as well as implementing sustainability
                                                                                                                                                                                                                                                                                                 programmes for the benefit of the nation.

           HANIZAN HOOD                                             RICK RAMLI                                             MOHAMMAD HUSSIN                                         MUZZAFFAR OTHMAN                                        AIDA MD DAUD                                          SUZANA AHMAD
           Chief Investment Officer, Public Markets                 Chief Investment Officer, Real Estate                  Chief Executive Officer &                               Chief Technology Officer                                Group Head, Human Capital                             Chief Risk Officer
                                                                                                                           Executive Director, ASNB
           Leads and oversees the investment, research              Leads and drives all of PNB’s business operations      Leads ASNB in developing and executing overall          Leads the establishment and execution of                Leads and drives PNB’s long-term human capital        Leads the implementation of Enterprise Risk
           and execution teams managing PNB’s proprietary           related to property and real estate investments and    business strategy to maintain its industry leadership   PNB’s enterprise-wide IT strategy and digital           strategies and develops human capital frameworks      Management (ERM) Framework across PNB
           and unit trust portfolios across multiple asset          operations, which include land banking activities,     position by continuing to increase the reach of         transformation, drives the development of               aimed at building in-house capabilities to enable     Group, by formulating a coherent risk appetite and
           classes namely public equities, fixed income and         development projects, core investment properties,      ASNB’s products and services and enhance the            enterprise technology standards, governance             the delivery of business results. Also implements     infrastructure as well as reporting on enterprise-
           money market instruments in both domestic and            hospitality, turnaround assets in the country, as      experience of its 14 million account holders.           processes and performance metrics, and ensures          human resource related initiatives that support       wide risk management issues to support effective
           international markets. Designated Fund Manager           well as investments in global real estate assets and                                                           alignment of IT strategy with the overall business      organisational strategic goals.                       decision-making and effective risk oversight.
           for the funds under management.                          funds.                                                                                                         strategy and the delivery of capabilities required to
                                                                                                                                                                                   achieve business success.

           MOHAMAD IDROS MOSIN                                      MOHD IRWAN AHMAD MUSTAFA                               FADZIHAN ABBAS MOHAMED                                  FAIRUZ SUZANA HJ KAMARUDDIN                             NORAMLY BACHOK @ ABDUL AZIZ                           DR. AHMAD BASRI IBRAHIM
           Group Head, Strategic Investments                        Group Head, Private Markets                            RAMLEE                                                  Group Head, Compliance & Integrity                      Head, Internal Assurance                              Head, Shariah Management
                                                                                                                           Chief Strategy Officer
           Leads engagement with PNB’s Strategic and                Leads and manages all PNB’s private equity             Develops and drives PNB’s Strategic Plan as             Leads the Compliance & Integrity Division and           Leads the internal audit functions to provide         Leads the Shariah Management Department which
           Core companies in relation to the formulation            investments under a structured Private Investment      well as monitors its execution to ensure the            assumes the key responsibility in planning and          independent and objective assurance by assessing      assumes the role of Secretariat to PNB’s Shariah
           and execution of value creation plans including          Framework which enables effective and consistent       organisation maintains its strategic focus.             executing the Compliance and Integrity Programme        the adequacy, efficiency and effectiveness of         Advisory Committee, and manages all Islamic
           transactional, operational and organisational            deployment into this asset class through direct        Also leads the Strategic Asset Allocation and           for the PNB Group in ensuring full compliance           governance processes, risk management and             finance and Shariah-related matters within the PNB
           initiatives with a view to further strengthen their      investments and global fund investments.               Transformation functions, which are responsible         with all relevant regulatory requirements, internal     internal controls implemented by the Management.      Group as well as undertakes initiatives to further
           overall performance and enhance sustainability of                                                               for overseeing PNB’s overall long-term asset            policies and procedures in business operations                                                                enhance the Shariah compliance of ASNB’s unit
           returns for PNB’s stakeholders.                                                                                 allocation, performance evaluation and aligning key     while maintaining good corporate governance and                                                               trust products.
                                                                                                                           management processes to strategy.                       highest ethical standards.

30                                                                                                                                                                                                                                                                                                                                                ANNUAL REPORT 2019   31
34 Message from the Group Chairman

40 The President & Group Chief Executive’s Review
MESSAGE              PERMODAL AN NASIONAL BERHAD                                                                                                                  PERMODAL AN NASIONAL BERHAD                        MESSAGE

     MESSAGE FROM                                                                                                                                                                                           MESSAGE FROM THE GROUP CHAIRMAN


                                                                                                                                                                    On the domestic front, Malaysia recorded       REVIEWING OUR STRATEGIC PLAN
                                                                                                                                                                    a slower growth, with Gross Domestic
                                                                                                                                                                    Product (GDP) moderating to an average of      A seminal development in FY2019 was
      DEAR UNIT                                                                                                                                                     4.3% in FY2019, compared to 4.7% in the        the Mid-Term Review conducted on the
      HOLDERS,                                                                                                                                                      previous year. In the recent six years, the
                                                                                                                                                                    FTSE Bursa Malaysia KL Composite Index
                                                                                                                                                                                                                   Strategic Plan 2017-2022, to gauge
                                                                                                                                                                                                                   its status in relation to our strategic
                                                                                                                                                                    (FBM KLCI) also recorded its fifth yearly      priorities, and to identify how we can raise
      It is with great pleasure                                                                                                                                     decline of 6%, to close at 1,588.76 on         the bar on our performance to a new
                                                                                                                                                                    31 December 2019. Following the slide          level. This has involved formulating and
      to share with you the
                                                                                                                                                                    in stock markets in the major economies        implementing frameworks and initiatives
      PNB Annual Report                                                                                                                                             in the first quarter of 2020, the domestic     towards enhancing sustainable returns,
                                                                                                                                                                    market has also experienced continued          ensuring effective investment and liquidity
      2019, which provides                                                                                                                                          setbacks.                                      management, and driving operational and
                                                                                                                                                                                                                   organisational excellence.
      an account of how we                                                                                                                                          CREATING VALUE FOR OUR
                                                                                                                                                                    UNIT HOLDERS                                   ACCELERATING THE
      performed in our drive                                                                                                                                                                                       DIVERSIFICATION OF OUR
                                                                                                                                                                    Despite the challenges, PNB has in 2019,       INVESTMENT PORTFOLIO
      to create sustainable                                                                                                                                         weathered the difficult investment climate
                                                                                                                                                                    and was able to sustain the growth of          During the year, we have accelerated the
      value for our unit holders
                                                                                                                                                                    Assets Under Management (AUM) and              diversification of our investment portfolio,
      and stakeholders for                                                                                                                                          to distribute a total of RM13.2 billion in     expanding our investments not only into
                                                                                                                                                                    income distribution to our unit holders.       other domestic asset classes but also
      the financial year ended                                                                                                                                      This is based on a conservative investment     into the international markets for Fixed
                                                                                                                                                                    approach that balances the value               Income, Public Equity, Private Equity and
      31 December 2019                                                                                                                                              generated from investments made earlier        Real Estate. Our diversification has thus
                                                                                                                                                                    since our inception, against our more recent   shifted our investments from predominantly
      (FY2019). In order to                                                                                                                                         diversification into new asset classes and     Malaysian equity-centric investments, into a
                                                                                                                                                                    into the global financial markets.             broader global portfolio thereby diversifying
      ensure the sustainability                                                                                                                                                                                    our risks. This diversification was
                                                                                                                                                                    PNB’s management of our funds are              conducted in a judicious manner, without
      of our returns, our
                                                                                                                                                                    underpinned and anchored by strong             affecting our current portfolio of domestic
      investment horizon                                                                                                                                            governance practices and effective risk        investments and without compromising our
                                                                                                                                                                    management, to avoid unnecessary risks         commitment to our unit holders.
      focuses on the longer                                                                                                                                         in delivering our mandate. This consistent
                                                                                                                                                                    approach has ensured that PNB is able          STRENGTHENING OUR ENTERPRISE
      term taking into account                                                                                                                                      to maintain its stability, even during down    RISK MANAGEMENT (ERM)
                                                                                                                                                                    market cycles. More importantly, PNB
      the fundamental shifts                                                                                                                                        investments have a long-term investment        In tandem with this diversification process,
                                                                                                                                                                    horizon to ensure our continued                we have also significantly strengthened
      that are taking place in                                                                                                         Assets Under                 sustainability.                                our ERM to enhance our awareness of
                                   AN INTENSELY CHALLENGING LANDSCAPE                                                                  Management grew to                                                          domestic and global market risks. This
      our environment.
                                                                                                                                                                    During the year under review, PNB’s AUM        is in alignment with our conservative
                                   The year 2019 saw a moderation in global economic growth which was impacted by a                    RM312.0 billion              surpassed the RM300 billion threshold          investment approach and of conducting
                                   number of non-economic developments. Global geopolitical developments on several                                                 to reach RM312.0 billion. An additional        risk mitigations to protect our unit holders’
                                   fronts resulted in uncertainties that generated greater volatility in the international financial   Income distribution to our   500,000 new account holders placed their       wealth. PNB’s investment decision-making
                                   markets. These included the escalating trade tensions between the major economies,                  unit holders                 funds with PNB, reflecting a 7.3% increase     process also involves multiple independent
                                   uncertainty in Europe and the United Kingdom (UK) over Brexit, and as we entered 2020,
                                   the outbreak of the COVID-19 virus that has now reached global proportions. This has
                                                                                                                                       RM13.2 billion               in our Units in Circulation to reach almost    layers, beginning at the working level, and
                                                                                                                                                                    254 billion units. Our 14 unit trust funds     flowing on up through the organisation to
                                   also been followed by the collapse in oil prices.                                                                                now collectively registered a total of 14.3    the Management Committee, Investment
                                                                                                                                       Units in Circulation
                                                                                                                                                                    million accounts nationwide.                   Committee and finally to the Board of
      Tan Sri Dr. Zeti Aziz
      Group Chairman
                                                                                                                                       254 billion                                                                 Directors.

34                                                                                                                                                                                                                                               ANNUAL REPORT 2019   35
MESSAGE                            PERMODAL AN NASIONAL BERHAD                                                                                                                                   PERMODAL AN NASIONAL BERHAD                        MESSAGE

     MESSAGE FROM THE GROUP CHAIRMAN                                                                                                                                                                                                            MESSAGE FROM THE GROUP CHAIRMAN

     Since establishing the ERM Framework in          have resulted in an information revolution
     2015, we have continuously reviewed our          that has changed the world. For PNB to
     financial and operational risk appetites and     retain our edge in this new landscape, we
     have now identified the respective Key Risk      are implementing an organisation-wide
     Indicators to ensure alignment with PNB’s        Knowledge Management (KM) Framework
     Strategic Plan and the Strategic Asset           to enable better-informed decision-making
     Allocation (SAA) Framework. In FY2019,           based on the organisation-wide repository
     we undertook a Risk Culture Survey to            of knowledge and high quality information
     evaluate the current state of risk awareness     and data.
     and understanding of the key challenges
     associated with implementing the ERM             The KM Framework will enhance staff
     Framework throughout the organisation.           accessibility to knowledge and information
                                                      that will enable them to make better
     Consequently, PNB has adopted a more             informed decisions within their respective
     unified risk strategy cutting across the         functions. The first phase of the KM
     various organisational functions that will       Framework will be implemented in FY2020,
     reduce the duplication of our risk mitigation    with the putting in place of a portal
     efforts. Our framework and processes             consisting of common information that will
     have now been enhanced significantly to          be accessible by all staff, and a confidential
     effectively manage the concentration of risk     information platform that will have restricted
     exposure of our strategic investments. At        accessibility.
     the same time, IT enablement measures
     have been designed to improve our existing       INTENSIFIED ENGAGEMENTS WITH
                                                      OUR STABLE OF COMPANIES
     technology capabilities to support the risk
     monitoring processes and to provide real-
                                                      Our Public Equity investments in Malaysia
     time insights for faster decision-making.
                                                      include Strategic and Core Companies that
     To ensure the abilities to deliver on our
                                                      span across a broad spectrum of industries
     unified risk strategy, we are also enhancing
                                                      and sectors. Comprising more than 30% of
     competencies and capacities in the risk
                                                      our portfolio, it includes banking, property,
     function throughout the organisation.
                                                      plantation, pharmaceutical, oil and gas,
                                                      and telecommunications. It represents a
                                                      significant touch point on a substantial part
                                                      of the Malaysian economy.

     A structured organisational transformation
                                                      PNB is therefore well placed to have a
     initiative has also commenced in PNB. The
                                                      greater role in driving their potential for
     aim is to build the capacity for effectively
                                                      sustainable growth and development. This
     delivering our identified priorities of a        is mainly in the form of ensuring stellar        developments, both of which we believe          Upon completion, Merdeka 118 will be a          to offer them the experience of working on      The London Underground’s Northern Line
     greater diversification of our investments,      corporate stewardship and good corporate         are heralding in a new era of sustainability-   distinctive building in the Kuala Lumpur        a large scale project, as part of our efforts   extension, which is nearing completion,
     an optimal liquidity position and an effective   governance while also propagating strong         centred property development at PNB.            skyline that will also symbolise Malaysia’s     in national human capital development.          will feature a new underground station
     risk management process. In FY2019,              ethical values. This is to engender a culture                                                    history, its contemporary environment,                                                          almost at our doorstep thereby providing
     a Steering Committee was established             of trust and accountability. While ensuring      Merdeka 118                                     and its future aspirations. We look             Battersea Power Station                         connectivity with other parts of London city.
     to oversee the implementation of the                                                                                                                                                                                                              The area also features green amenities,
                                                      a performance that is sustainable, also                                                          forward to revealing its distinctive and
     key initiatives under our organisational                                                                                                                                                                                                          amongst others, a park, which can be
                                                      of importance is the consideration of            Within Malaysia, the iconic Merdeka 118         differentiated features to the public at        Abroad in the UK, PNB has progressed
     transformation plan, which encompasses                                                                                                                                                                                                            enjoyed by the surrounding community.
                                                      bringing value to the community and to           development is targeting to achieve a triple-   the official launch in 2022. As we near         with the neighbourhood redevelopment of         The Phase II of the project, which we jointly
     10 key elements that would result in a           environmental sustainability.                    platinum rating - the with Leadership in        completion, we are working on creating          the Grade II listed Battersea Power Station     acquired with the Employees Provident
     holistic transformation of PNB.                                                                   Energy and Environmental Design (LEED),         value for the surrounding communities.          in London. While encountering challenges        Fund (EPF) in 2018, is scheduled to
                                                      PROGRESSING WITH OUR                             the GreenRE and the Green Building Index        This is in line with our goals of advancing     in the early stages of the project, these       be completed by July 2021. Upon its
     A key element of our transformation is to        PROPERTY DEVELOPMENTS                            (GBI) certification. This would make it the     sustainable development. This includes          have now been satisfactorily resolved. It       completion, Apple will be the largest office
     become a Knowledge-Based Organisation.                                                            first project in the country to earn such a     the development of small businesses             is now full steam ahead, demonstrating          tenant occupying approximately 500,000
     Recent breakthroughs in information              During the year, we have also recorded           rating.                                         and entrepreneurs from the surrounding          Malaysia’s capabilities on the international    square feet, across 6 floors inside the
     and communication technologies (ICT)             good progress in our two major property                                                          precinct, as well as to take on board interns   stage.                                          historic icon.

36                                                                                                                                                                                                                                                                                   ANNUAL REPORT 2019   37
MESSAGE                            PERMODAL AN NASIONAL BERHAD                                                                                                                                  PERMODAL AN NASIONAL BERHAD                        MESSAGE

     MESSAGE FROM THE GROUP CHAIRMAN                                                                                                                                                                                                           MESSAGE FROM THE GROUP CHAIRMAN

     INVESTING IN OUR PEOPLE                          FINANCIAL EDUCATION AND                        key platform for reaching out to the public.    on issues relating to leadership, innovation,     We are confident that his leadership would     ACKNOWLEDGEMENTS
                                                      OUTREACH                                       FY2019 saw the 20th edition of MSAM. On         economics, politics and societal elements         steer PNB into becoming a distinctive
     Following the Mid-Term Review, new                                                              behalf of PNB, I would like to record my        was well attended by over 500 high-level          world-class investment institution.            On behalf of everyone at PNB, I would
     scopes and functions have been                   Since its inception, PNB has championed        appreciation to the 3.9 million participants    participants.                                                                                    like to take this opportunity to record our
     introduced across the investment division,       the cause of financial education and           who have supported us since its inception.                                                        MOVING FORWARD                                 appreciation to the Yayasan Pelaburan
     reflecting the new areas of focus in the         literacy, as well as enhancing access to                                                       FUTURE FOCUS ON                                                                                  Bumiputra (YPB) Board of Trustees, for
     strategies being adopted. Levelling up           our unit trusts. This is to promote greater    Our future focus will thus be on                ENVIRONMENTAL SUSTAINABILITY                      As we enter 2020, it is a transition into      their trust in PNB to discharge our duties
     the skills and capabilities within the           financial inclusion, and to empower            expanding our digital reach, through                                                              uncharted territory. The world was not in      with the highest level of responsibility.
     organisation is seen as integral and             communities with the necessary skills to       simple, easily understood and navigable         Our commitment to adopt a more                    a state of preparedness to manage such         I also wish to thank my fellow directors on
     paramount for this to be achieved.               make better informed financial decisions.      digital applications and platforms. This        sustainability-driven approach in our             a health pandemic that has now erupted         the Board of PNB for their commitment
                                                      Over the medium term, it will contribute       is to strengthen financial literacy thereby     investments is evidenced from the fact            in most parts of the world. The immediate      and support towards ensuring that PNB
     In FY2019, the number of compulsory              towards bringing about sustainable and         fostering the development of a more             that PNB was the first to adopt the               response has to be to do what it takes to      continues to deliver sustainable returns to
     training days for all levels of employees        inclusive socio-economic development.          financially savvy society. We will continue     ASEAN Green Bond Standards. Our                   contain its spread so as to save lives.        our unit holders.
     throughout the organisation was increased                                                       to engage with Malaysians of all ages, from     Sukuk Programme for the Merdeka 118
     from 2.5 days in FY2018, to 8 days in            In FY2019, PNB became one of the               the tech-savvy millennials, to the pioneering   development also fully met the Socially           The consequent economic disruption             We also wish to thank Datin Paduka Kartini
     FY2019. Concurrently, the training budget        founding members of the National Strategy      golden generation.                              Responsible Investment (SRI) Sukuk                and damage arising from the necessary          Haji Abdul Manaf for her dedication and
     was increased by 54.6% from RM13.8               of Financial Literacy 2019-2023. With                                                          Requirements. Towards advancing our               shutdowns have been less for those             commitment to PNB throughout her 36
     million in 2018 to RM21.3 million in 2019.       the digitalisation of society as well as the   TOWARDS A MORE ROBUST                           sustainability journey in the years to come,      countries that took early action, and more     years of service with PNB. Datin Paduka
     As a result, the average training hours per      advancement of financial technology            CORPORATE MALAYSIA                              we will begin formalising a Sustainability        for those that delayed since the latter        Kartini, who retired on 31 December 2019,
     employee has increased by more than              (FinTech), efforts are also being directed                                                     Framework that focuses on delivering              would require a more prolonged shutdown.       was a longstanding key member of PNB’s
     three times to 64 hours in FY2019.               towards enhancing the digital financial        In fulfilling our greater role to achieve a     a positive impact on the economy, the             The massive economic and financial policy      senior management team, driving PNB’s
                                                      literacy skills of the public.                 more robust Corporate Malaysia, PNB             environment, and on the community. PNB’s          response by most countries have aimed          major merger and acquisition exercises
     STRENGTHENING GOVERNANCE                                                                        has widened our engagements beyond              organisational sustainability aspirations         at cushioning its impact on employment,        and fostering a strong rapport with our
                                                      Moving into 2020, we will remodel our          our stable of companies, by reaching out        are anchored on practising the values of          earnings and on overall economic activity.     investee companies. We wish her all the
     Strong governance provides the structural        flagship Minggu Saham Amanah Malaysia          to all of Corporate Malaysia. The inaugural     a sustainable environment and the goals           While the economic pain of the shutdown        best with her future.
     foundation that is vital for the long-term       (MSAM) into a different format which will      PNB Corporate Summit in 2019 reflects           of achieving an equitable and inclusive           may be intense and immense, once lifted,
     performance of any organisation. PNB             embrace the increased level of the digital     our efforts in this direction. The event,       society.                                          economic activity can be reignited. In         Our deep gratitude is also extended
     has consistently maintained a strong             content in consumption. This nationwide        with the theme of “Rebooting Corporate                                                            the intermediate timeframe, a recession        to all Board members of ASNB and all
     commitment to the highest standards of           event, which also brings together our          Malaysia”, was officiated by the then           LEADERSHIP TRANSITION                             may be felt before the recovery occurs.        PNB group of companies, members of
     corporate governance. This is to ensure our      investee companies, State Governments          Prime Minister, YAB Tun Dr. Mahathir                                                              We therefore need to look beyond the           the Shariah Advisory Committee and
     potential to deliver our mandate to enhance      and Government agencies, has been a            Mohamad. The gathering which focused            In FY2019, PNB witnessed a smooth                 immediate circumstances.                       the States’ Fatwa Councils, as well as
     the wealth of our unit holders. We have a                                                                                                       leadership transition with the appointment                                                       Board members, senior management and
     multiplicity of layers in our governance                                                                                                        of a new President and Group Chief                Our position as a major investor in the        employees of PNB’s Strategic Companies,
     arrangements that ensures oversight,                                                                                                            Executive (PGCE) to drive the institution         domestic and international markets will        for their continuing contributions towards
     transparency and accountability.                                                                                                                forward in line with our identified strategies.   be significantly challenged as markets will    the fulfilment of PNB’s mandate.
                                                                                                                                                     Dato’ Abdul Rahman Ahmad completed his            continue to be confronted with pressures in
     All decisions made are guided by robust                                                                                                         tenure as PGCE on 30 September 2019.              2020. The strategy going forward is to ride    To everyone at PNB who continue to
     internal policies and procedures which are                                                                                                      On behalf of everyone at PNB, I would like        out this challenging period and to be well     strive with the company as we face these
     continuously enhanced to be in line with                                                                                                        to thank him for his valuable contributions to    positioned to ride on the recovery when it     uncertain times together, I commend
     international best practices. Our various                                                                                                       PNB and its group of companies during his         occurs. In the meantime, in this uncertain     and thank you for your hard work and
     Management Steering Committees with                                                                                                             three-year tenure. He continues to remain         environment, our strategic priorities for      dedication and look forward to braving the
     their distinct functions are cross functional.                                                                                                  within the PNB Group in his new role as           2020 will be to continue to pursue our asset   challenges of 2020 together.
     This is particularly important for project                                                                                                      Chairman at Sime Darby Berhad, and also           diversification strategy and to enhance
     management and operational management.                                                                                                          Chairman at Velesto Energy Berhad.                our engagements with our Strategic and         To our unit holders, we sincerely thank you
     The entirety of PNB’s governance process                                                                                                                                                          Core companies to contribute towards           for your sustained faith and trust in PNB. As
     also ensures our ability to uphold the                                                                                                          In succeeding Dato’ Abdul Rahman, we              enhancing their potential. We will also        we forge ahead into 2020, we reaffirm our
     strictest level of compliance with all the                                                                                                      welcomed on board Jalil Rasheed, who              fortify our Risk Management processes,         commitment to continue to overcome the
     regulations that must be adhered to.                                                                                                            joined PNB on 1 October 2019. Jalil has           and maintain an upward trajectory in           challenges as best we can and to deliver
                                                                                                                                                     returned to Malaysia after serving with           our organisational transformation efforts      the best possible outcomes for our unit
                                                                                                                                                     international fund managers abroad,               and our communications with all our            holders.
                                                                                                                                                     and brings with him vast experience               stakeholders.
                                                                                                                                                     in    managing    global   investments.                                                          Tan Sri Dr. Zeti Aziz

38                                                                                                                                                                                                                                                                                  ANNUAL REPORT 2019   39
MESSAGE                 PERMODAL AN NASIONAL BERHAD                                                                                                                      PERMODAL AN NASIONAL BERHAD                            MESSAGE

     THE PRESIDENT &                                                                                                                                                                                                                    THE PRESIDENT &
                                                                                                                                                                                                                         GROUP CHIEF EXECUTIVE’S REVIEW

      DEAR UNIT                                                                                                                                          Q&A
                                                                                                                                                         AGAINST A SHIFTING BACKDROP AND IN A VOLATILE, UNCERTAIN, COMPLEX AND
      HOLDERS,                                                                                                                                           AMBIGUOUS (VUCA) ENVIRONMENT, HOW WILL PNB ENSURE THAT IT CONTINUES TO
                                                                                                                                                         DELIVER SUSTAINABLE RETURNS TO ITS UNIT HOLDERS IN THE LONGER TERM?
      As the President and                                                                                                                               Keeping True To Our Mandate                              short-term impact on our dividend payout to
                                                                                                                                                                                                                  our unit holders for the year. While the paper
      Group Chief Executive                                                                                                                              We are guided by our mandate of enhancing our
                                                                                                                                                                                                                  impairment was unavoidable, most importantly,
                                                                                                                                                         unit holders’ wealth and believe in maintaining
                                                                                                                                                                                                                  by reflecting the current stock value, PNB has
      (PGCE) of PNB, I am                                                                                                                                sustainable and stable recurring long-term returns
                                                                                                                                                                                                                  paid out clean profit based on the existing market
                                                                                                                                                         that our unit holders can rely on.
                                                                                                                                                                                                                  value of these stocks.
      pleased to present
                                                                                                                                                         Our central proposition in maintaining sustainable
                                                                                                                                                                                                                  Aggressively Pursuing Our Portfolio
      the company’s Annual                                                                                                                               returns is to pay out realistic yields that reflect
                                                                                                                                                                                                                  Diversification Strategy
                                                                                                                                                         market conditions, as opposed to those that
      Report for the financial                                                                                                                           do not accurately reflect the true circumstances         To ensure we continue to deliver sustainable
                                                                                                                                                         impacting our assets. In providing investment            returns to our unit holders, we have fine-tuned
                                                                                                                                                         opportunities, PNB undertakes the associated             our strategy based on the outcomes of the Mid-
      year ended 31 December                                                                                                                             market risks and employs a prudent investment            Term Strategic Review we conducted in FY2019.
                                                                                                                                                         management approach to ensure we consistently            We are aggressively pursuing a phased portfolio
      2019 (FY2019). During                                                                                                                              deliver on our mandate.                                  diversification into international markets and
                                                                                                                                                                                                                  different asset classes, which allows us to spread
      the year, PNB continued                                                                                                                            Delivering Realised Gains                                our risks across various markets, rather than
                                                                                                                                                                                                                  over concentrate it on the domestic Public Equity
      to operationalise our                                                                                                                              The income distributed by PNB's unit trust
                                                                                                                                                                                                                  market. This is being done both internally and
                                                                                                                                     PNB’s AUM           funds are based on realised gains for the year,
                                                                                                                                                                                                                  through outsourcing.
      strategic objectives and                                                                                                       in 2019             which takes into account the impact of tough
                                                                                                                                                         market conditions. In FY2019, PNB’s domestic
                                                                                                                                                                                                                  Effecting Better Liquidity and Financial
                                                                                                                                     Total AUM           investment was impacted by the FBM KLCI’s
      prudently conducted our                                                                                                                                                                                     Management
                                                                                                                                     RM312.0             weak performance, which posted its fifth yearly
                                                                                                                                                         decline in the past six years and was one of             We have implemented focused measures towards
      investments with the aim                                                                                                       billion             the weakest performing indices globally. With            better managing our liquidity by setting up the
                                                                                                                                                         approximately 68% of our investment portfolio            Treasury Desk, and more effectively managing
      of delivering sustainable                                                                                                                          concentrated in the domestic Public Equity               our risks. These include processes that take
                                                                                                                                     Proprietary Funds   market, this significantly impacted our realised         into account global market risks that we may be
      returns to our unit
                                                                                                                                     RM47.9              gains for the year. However, our global portfolio
                                                                                                                                                         diversification generated greater returns from our
                                                                                                                                                                                                                  subject to as a result of our international portfolio
                                                                                                                                                                                                                  diversification. The newly-created Treasury Desk
      holders in line with our                                                                                                       billion             international investments, which offset the lower        oversees PNB’s liquidity management, funding,
                                                                                                                                                         returns from domestic investments, and enabled           foreign exchange and all aspects of PNB’s
      mandate.                            2019 PERFORMANCE HIGHLIGHTS                                                                Unit Holders’       us to generate sustainable and stable realised           treasury operations.
                                                                                                                                     Investments         gains.
                                                                                                                                                                                                                  Practising Strong Governance
                                          Our Group Chairman, YBhg Tan Sri Dr. Zeti Aziz has explained in her message how            RM264.1             Conducting Impairments to Reflect Actual
                                                                                                                                                                                                                  We are engaging more intensely with our Strategic
                                          FY2019 was a challenging year, with international and domestic growth impacted
                                          by various geopolitical and macroeconomic developments. Developed economies
                                                                                                                                     billion             Market Performance
                                                                                                                                                                                                                  and Core Companies by providing strong
                                                                                                                                                         All our investments in shares, fixed income              corporate stewardship and promoting good
                                          recorded moderate growth, with the exception of Japan which had a higher rate of                               securities, properties and receivables are subject       corporate governance, to guide our investee
                                          growth on the back of fluctuating crude oil prices. International and domestic markets     Fixed Price Funds
                                                                                                                                                         to impairment assessments at the end of each             companies’ sustainable growth and performance.
                                          remained volatile, due to market uncertainties that arose from unresolved trade disputes   RM253.2             financial year, in line with PNB’s accounting policy     Underpinning this is PNB’s robust governance
                                          and geopolitical uncertainties.                                                                                of cost less permanent diminution in value. In           structure and processes, which guide and inform
                                                                                                                                     billion             FY2019, we conducted an impairment exercise              our investment decisions through multiple,
                                          Nonetheless, PNB navigated these challenges to deliver stable performance for the                              in relation to assets we own to reflect the change       independent layers that promote transparency
                                                                                                                                     Variable Price      in value of the companies, due to the challenging        and accountability. To ensure we have the
                                          year. Our AUM increased by 4.5% to RM312.0 billion in FY2019, reflecting the trust of
                                                                                                                                     Funds               economic and market climate.                             capability to deliver on our promise to our unit
                                          our unit holders in PNB’s ability to deliver sustainable long-term dividends. A total of                                                                                holders, we are committed to an organisational
                                          RM47.9 billion of our AUM consisted of proprietary funds, whilst RM264.1 billion is the    RM10.9              We conducted the impairment in line with our             transformation journey that will support our value
      Jalil Rasheed                       unit holders’ investments comprising both Fixed Price and Variable Price Funds.            billion             conservative impairment policy, which had a              creation efforts for our unit holders.
      President & Group Chief Executive

40                                                                                                                                                                                                                                                          ANNUAL REPORT 2019   41
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