MAYBANK FINANCIAL INSTITUTIONS INCOME FUND - Maybank Asset ...

 
Maybank Asset Management Sdn Bhd
                                                                       (421779-M)
                                                                 Level 12 Tower C
                                                                 Dataran Maybank
                                                                No.1 Jalan Maarof
                                                    59000 Kuala Lumpur, Malaysia
                                                        Telephone +603 2297 7888
                                                         Facsimile +603 2297 7998
                                                           www.maybank-am.com

MAYBANK FINANCIAL INSTITUTIONS
INCOME FUND
Annual report
For the financial year ended 31 January 2018
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

CONTENT                                      PAGE

Manager's report                              1-5

Trustee's report                               6

Statement by Manager                           7

Independent auditors' report                 8 - 11

Statement of comprehensive income              12

Statement of financial position                13

Statement of changes in equity                 14

Statement of cash flows                        15

Notes to the financial statements            16 - 43
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

Manager’s report for the financial year ended 31 January 2018

A. Fund Information

   1. Name of Fund
      Maybank Financial Institutions Income Fund (the "Fund")

   2. Type of Fund
      Income

   3. Category of Fund
      Wholesale fixed income fund

   4. Duration of Fund
      The Fund is an open-ended fund.

   5. Fund launch date
      17 December 2009

   6. Fund’s investment objective
      The objective of the Fund is to achieve regular income stream which is deriving from the
      portfolio.

   7. Fund distribution policy
      The Fund intends to distribute income, if any, at least half-yearly on best effort basis. However,
      the Manager reserves the right not to distribute income, at its absolute discretion.

   8. Fund's performance benchmark
      12-month Maybank fixed deposit rate.

   9. Fund's investment policy and principal investment strategy
      The Fund seeks to achieve its objective by investing up to 95% of its Net Asset Value ("NAV")
      in fixed income securities issued by financial institutions and/or bank guaranteed fixed income
      securities.

       The Manager will also invest between 5% to 100% of the Fund’s NAV in fixed deposits and/or
       money market instruments.

                                                     1
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

Manager’s report for the financial year ended 31 January 2018 (cont'd)

B. Performance Review

   Returns of the Fund and its benchmark for the financial year ended 31 January 2018 are as
   follows:

                                                                                                                                                    The Fund                          Benchmark
   Period
                                                                                                                                                           %                                  %
   1 February 2018 to 31 January 2018                                                                                                                    4.33                               3.10

   Performance of the Fund for the financial year ended 31 January 2018:

                                           Maybank Financial Institutional Income
      5.00%                                12-Months Maybank Fixed Deposit Rate

      4.50%
                                                                                                                                                                                                   4.33%
      4.00%

      3.50%
                                                                                                                                                                                                   3.10%
      3.00%

      2.50%

      2.00%

      1.50%

      1.00%

      0.50%

      0.00%
                                                              16 May 17

                                                                                                                                                  14 Nov 17

                                                                                                                                                              10 Dec 17
                                      25 Mar 17

                                                                                      07 Jul 17
              01 Feb 17

                          27 Feb 17

                                                                          11 Jun 17

                                                                                                                                                                          05 Jan 18

                                                                                                                                                                                       31 Jan 18
                                                  20 Apr 17

                                                                                                                                      19 Oct 17
                                                                                                  02 Aug 17

                                                                                                              28 Aug 17

                                                                                                                          23 Sep 17

   Source: Novagni Analytics and Advisory Sdn Bhd, as at 31 January 2018

   Investors are reminded that past performance of the Fund is not necessarily indicative of its future
   performance and that unit prices and investment returns may fluctuate.

   The Fund recorded a return of 4.33% for the financial year ended 31 January 2018, compared to
   the benchmark of 3.10% over the same period.

                                                                                                        2
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

Manager’s report for the financial year ended 31 January 2018 (cont'd)

C. Market Review

   In 2017, the US ("United States") Federal Reserve (“the Fed”) has hiked interest rates three times
   leading to a surge in the front-end of the US Treasury (“UST”) yield curve. Long-term USTs were
   supported by haven demand amid sustained political drama and uncertainties surrounding the
   passage of the US tax reform bill. Meanwhile, the Fed’s balance sheet normalisation plan had little
   impact on the bond market while the accelerated flattening of the UST yield curve raised a critical
   question of whether it was an early sign of an economic slowdown.

   Over in Europe, both the European Central Bank (“ECB”) and the Bank of England (“BoE”) have
   become more hawkish in 2017. The ECB, after its hawkish tilt sparked a bond rout in June, has
   been careful in managing market expectations regarding policy normalisation. In October, it
   signalled a plan to gradually exit from the quantitative easing (“QE”) programme by halving its
   monthly bond purchases to EUR30 billion starting January 2018. The programme will extend to
   September 2018. Meanwhile, forward guidance continued to reiterate the ECB’s view that
   historically low interest rates will stay for a prolonged period, obviously to sustain growth and lift
   inflation to a healthy 2% level. In the United Kingdom (“UK”), the BoE delivered its first interest rate
   hike in more than a decade, raising the Official Bank Rate to 0.50% from 0.25%. The rate hike was
   widely expected as BoE Governor Mark Carney had indicated “limited” tolerance of above-target
   inflation.

   Back in Malaysia, Bank Negara Malaysia (“BNM”) raised the OPR by 25bps ("basis points") to
   3.25% in January 2018 Monetary Policy Committee (“MPC”) meeting this year, first policy action
   after its policy cut in July 2016. This was also Malaysia’s first hike since July 2014. The statement
   accompanying the decision remained hawkish and policymakers pointed towards brighter
   prospects for global growth and domestic demand. Meanwhile, inflation is set to be affected by
   commodity and energy prices, which policymakers think may trend higher in 2018. Policymakers
   also stated that the hike is in effect normalization and is to pre-empt a buildup of risks.
   Furthermore, indicating that current policy remains accommodative suggests room for further
   normalization. This would mean that should inflation push higher, then the central bank stands
   ready to hike rates further.

   In addition, the MYR ("Malaysian Ringgit") govvies started off the new year on firmer footing, in
   conjunction with the stronger MYR against greenback. However, MYR bonds were under pressure
   late in January, as sentiment turned guarded ahead of the MPC meeting as well as from rise in
   UST yields. Yet, the positive sentiment in secondary space spurred demand on primary offerings,
   particularly on the short dated 5 year Government Investment Issue (“GII”) auction, which
   registered 2.581x bid-to-cover (“btc”).

D. Market Outlook

   Following the December rate hike, market focus has shifted to the question of the extent to which
   the Fed would normalise its federal funds rate (“FFR”) in 2018 as the US economy continued to
   march on despite policy uncertainties and two major hurricanes. Industrial production and capacity
   utilisation have continued to rise, and in December, the jobless rate fell to 4.1%, the lowest since
   2001. Persistently robust consumer sentiment and a stronger household balance sheet have
   pushed up asset prices and raised private consumption. Against such a backdrop, the market does
   not rule out the possibility of more rate increases than currently priced-in by the markets. This is
   especially true if signs of overheating emerge, especially after the implementation of tax reforms.

                                                      3
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

Manager’s report for the financial year ended 31 January 2018 (cont'd)

D. Market Outlook (cont'd)

   Moving on to the local front, the local govvies market is likely to see more net foreign inflows in
   2018. This expectation is based on reasons that include; (1) an expectation of an overnight policy
   rate (“OPR”) hike in early 2018; (2) an upbeat outlook of the ringgit; (3) an improvement in crude oil
   prices; and (4) the strengthening of the US economy that could lead to a faster pace of interest
   rate normalisation. The lower volume of maturing MGS/GII papers in 2018 with a projected total
   value of RM62.8 billion should also provide support.

   Additionally, markets are also anticipating BNM to hike its benchmark OPR by between 25 basis
   points and 50 bps in 2018. This is premised on the increased likelihood of Malaysia’s gross
   domestic product (“GDP”) growth hitting above the 5.0% level again in 2018. This is especially true
   when the external sector continues to strengthen and consumer spending growth rises above its
   long-term trend pace of 7.0%. The expected FFR rate hikes as the US economy strengthens
   further also lend support to the possibility of OPR hikes in 2018. In November 2017, BNM had
   surprised investors with its hawkish MPC policy statement even as it announced its decision to
   keep the OPR at 3.0%.

E. Investment Strategies

   We continue to hold a constructive view of the market in light of an increase in opportunities given
   better yield levels. We remain optimistic and seek to continue to raise cash where possible in order
   to take advantage of attractive new issuances and opportunities in the secondary market. Also, as
   there will be some bond maturities coming into 2018, hence we can rebalance our portfolio for
   better carry and trading opportunities going forward.

F. Cross trades

   There were cross trades undertaken in the period under review. All transactions were executed in
   accordance with the Maybank Asset Management Investment Policy and with the requisite
   approvals from Trustee and the relevant committees. All transactions were executed through a
   dealer or a financial institution at arm’s length basis.

G. Asset Allocation

   The comparison of the Fund’s asset allocation as at 31 January 2018 to the previous financial
   period is as follows:

                                              31.01.2018                          31.01.2017
   Asset allocation
                                               RM                 %                RM                 %
   Unquoted fixed income
   securities - local                 212,686,329              96.26     173,709,834              79.05
   Cash, deposits with licensed
   financial institutions and other
   net assets                           8,253,422              3.74       46,024,169              20.95
   Total                              220,939,751            100.00      219,734,003             100.00

                                                     4
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

Manager’s report for the financial year ended 31 January 2018 (cont'd)

H. NAV as at 31 January 2018

     Below is the summary of the NAV of the Fund:

                                                         31.01.2018     31.01.2017    Changes (%)
     NAV (RM)                                           220,939,751    219,734,003           0.55
     Units in circulation (unit)                        219,030,772    217,467,801           0.72
     NAV per unit (RM)                                       1.0087         1.0104          (0.17)

I.   Soft Commissions and Rebates

     The Manager and its delegates will not retain any form of soft commissions or rebates from or
     otherwise share in any commission with any broker in consideration for directing dealings in the
     investments of the Fund unless the commissions received are retained in the form of goods and
     services such as financial wire services and stock quotations system incidental to investment
     management of the Fund. All dealings with brokers are executed on best available terms.

     During the financial year ended 31 January 2018, the Manager and its delegates did not receive
     any soft commissions and rebates from brokers or dealers.

                                                    5
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

TRUSTEE'S REPORT

TO THE UNITHOLDERS OF MAYBANK FINANCIAL INSTITUTIONS INCOME FUND
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2017

We have acted as Trustee of Maybank Financial Institutions Income Fund (the "Fund") for the financial
year ended 31 January 2018. In our opinion and to the best of our knowledge, Maybank Asset
Management Sdn Bhd (the "Manager") has operated and managed the Fund in accordance with the
following:

(a) Limitations imposed on the investment powers of the Manager and the Trustee under the Deed, the
    Securities Commission's Guidelines on Unlisted Capital Market Products under the Lodge and
    Launch Framework, the Capital Markets and Services Act 2007 and other applicable laws;

(b) Valuation and pricing were carried out in accordance with the Deeds and relevant regulatory
    requirements;

(c) Creation and cancellation of units were carried out in accordance with the Deeds and relevant
    regulatory requirements; and

(d) The distribution of returns for the year are tied to and reflect the objectives of the Fund.

For and on behalf of
PB Trustee Services Berhad

Julia Mustaffa
Chief Executive Officer

Kuala Lumpur, Malaysia
30 March 2018

                                                      6
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

STATEMENT BY MANAGER

We, Dr Hasnita Binti Dato' Hashim and Badrul Hisyam Bin Abu Bakar, being two of the Directors of
Maybank Asset Management Sdn Bhd (the "Manager"), do hereby state that, in the opinion of the
Manager, the accompanying financial statements set out on pages 12 to 43 are drawn up in accordance
with Malaysian Financial Reporting Standards and International Financial Reporting Standards so as to
give a true and fair view of the financial position of Maybank Institutional Sukuk Fund as at 31 January
2018 and of its results, changes in equity and cash flows for the financial year then ended and comply
with the requirements of the Deeds.

For and on behalf of the Manager

Dr Hasnita Binti Dato' Hashim                                   Badrul Hisyam Bin Abu Bakar

Kuala Lumpur, Malaysia
30 March 2018

                                                    7
Independent Auditors’ Report to the Unitholders of
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

Report on the audit of the financial statements

Opinion

We have audited the financial statements of Maybank Financial Institutions Income Fund (the "Fund"), which
comprise the statement of financial position as at 31 January 2018 of the Fund, and statement of comprehensive
income, statement of changes in equity and statement of cash flows of the Fund for the period then ended, and notes
to the financial statements, including a summary of significant accounting policies and other explanatory
information, as set out on pages 12 to 43.

In our opinion, the accompanying financial statements give a true and fair view of the financial position of the as at
31 January 2018, and of its financial performance and cash flows for the period then ended in accordance with
Malaysian Financial Reporting Standards and International Financial Reporting Standards.

Basis for opinion

We conducted our audit in accordance with approved standards on auditing in Malaysia and International Standards
on Auditing. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the
audit of the financial statements section of our report. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our audit opinion.
                                                                                                                          12 - 37
Independence and other ethical responsibilities

We are independent of the Fund in accordance with the By-Laws (on Professional Ethics, Conduct and Practice) of the
Malaysian Institute of Accountants (“By-Laws”) and the International Ethics Standards Board for Accountants’ Code
of Ethics for Professional Accountants (“IESBA Code”), and we have fulfilled our other ethical responsibilities in
accordance with the By-Laws and the IESBA Code.

Information other than the financial statements and auditors’ report thereon

The Manager of the Fund ("the Manager”) is responsible for the other information. The other information comprises
the information included in the annual report of the Fund, but does not include the financial statements of the Fund
and our auditors’ report thereon.

Our opinion on the financial statements of the Fund does not cover the other information and we do not express any
form of assurance conclusion thereon.

                                                            8
Independent Auditors’ Report to the Unitholders of
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND (cont'd)

Information other than the financial statements and auditors’ report thereon (cont'd.)

In connection with our audit of the financial statements of the Fund, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial statements of the
Fund or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Manager and Trustee for the financial statements

The Manager is responsible for the preparation of financial statements of the Fund that give a true and fair view in
accordance with Malaysian Financial Reporting Standards and International Financial Reporting Standards. The
Manager is also responsible for such internal control as the Manager determines is necessary to enable the
preparation of financial statements of the Fund that are free from material misstatement, whether due to fraud or
error.

In preparing the financial statements of the Fund, the Manager is responsible for assessing the Fund’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the Manager either intends to liquidate the Fund or to cease operations, or have no
realistic alternative but to do so.

The Trustee is responsible for overseeing the Fund’s financial reporting process. The Trustee is also responsible for
ensuring that the Manager maintains proper accounting and other records as are necessary to enable true and fair
presentation of these financial statements.

Auditors’ responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements of the Fund as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with approved standards on auditing in Malaysia and International Standards on Auditing will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of these financial statements.

                                                             9
Independent Auditors’ Report to the Unitholders of
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND (cont'd)

Auditors’ responsibilities for the audit of the financial statements (cont'd.)

As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards on
Auditing, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

● Identify and assess the risks of material misstatement of the financial statements of the Fund, whether due to
  fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
  sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
  resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
  omissions, misrepresentations, or the override of internal control.

● Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
  appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
  Fund’s internal control.

● Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
  related disclosures made by the Manager.

● Conclude on the appropriateness of the Manager’s use of the going concern basis of accounting and, based on
  the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
  significant doubt on the Fund’s ability to continue as a going concern. If we conclude that a material uncertainty
  exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial
  statements of the Fund or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based
  on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may
  cause the Fund to cease to continue as a going concern.
● Evaluate the overall presentation, structure and content of the financial statements of the Fund, including the
  disclosures, and whether the financial statements of the Fund represent the underlying transactions and events in
  a manner that achieves fair presentation.

We communicate with the Manager regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

                                                             10
Independent Auditors’ Report to the Unitholders of
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND (cont'd)

Other matters

This report is made solely to the unitholders of the Fund, as a body, in accordance with the Guidelines on Unit Trust
Funds issued by the Securities Commission Malaysia and for no other purpose. We do not assume responsibility to
any other person for the content of this report.

Ernst & Young                                                       Lee Pei Yin
AF: 0039                                                            03189/05/2019J
Chartered Accountants                                               Chartered Accountant

Kuala Lumpur, Malaysia
30 March 2018

                                                           11
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

STATEMENT OF COMPREHENSIVE INCOME
FOR THE FINANCIAL YEAR ENDED 31 JANUARY 2018

                                                                                         2018        2017
                                                               Note                       RM          RM

INVESTMENT INCOME

Interest income                                                  3                  10,490,653   8,263,385
Net realised gain/loss on available-for-sale ("AFS")
  financial assets                                                                     313,916     (33,745)
Other income                                                                                 -         500
                                                                                    10,804,569   8,230,140

EXPENSES

Manager's fee                                                    4                   1,381,292   1,114,462
Trustee's fee                                                    5                     115,108      92,872
Auditors’ remuneration                                                                   7,800       7,800
Tax agent's fee                                                                          3,100       2,500
Administrative expenses                                                                 94,786      75,338
                                                                                     1,602,086   1,292,972

Net income before taxation                                                           9,202,483   6,937,168
Income tax expense                                               6                           -           -
Net income after taxation                                                            9,202,483   6,937,168

Other comprehensive income

Items that may be reclassified
   subsequently to profit or loss
Net changes in fair value of AFS financial assets                                      488,498     771,568
Total comprehensive income for the financial year                                    9,690,981   7,708,736

Net income after taxation is made up of
 the following:
    Net realised income                                                              9,202,483   6,937,168
                                                                                     9,202,483   6,937,168

Distributions for the financial year:
Net distributions                                               12                   9,473,812   7,457,070
Gross distribution per unit (sen)                               12                        4.50        4.00
Net distribution per unit (sen)                                 12                        4.50        4.00

The accompanying notes form an integral part of the audited financial statements.

                                                        12
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

STATEMENT OF FINANCIAL POSITION
AS AT 31 JANUARY 2018

                                                                                         2018          2017
                                                               Note                       RM            RM

ASSETS

Cash at bank                                                                          1,684              842
Deposits with licensed financial institutions                    7               24,653,000       47,215,000
Interest income receivables                                                       3,133,462        2,217,695
AFS financial assets                                             8              212,686,329      173,709,834
TOTAL ASSETS                                                                    240,474,475      223,143,371

LIABILITIES

Distributions payable                                                                4,380,615     3,262,017
Due to Manager                                                   9                  15,125,923       112,440
Due to Trustee                                                                          10,494         9,370
Other payables and accruals                                     10                      17,692        25,541
TOTAL LIABILITIES                                                                   19,534,724     3,409,368

NET ASSET VALUE ("NAV") OF THE FUND                                             220,939,751      219,734,003

EQUITY

Unitholders' capital                                           11(a)            219,273,729      218,155,395
Retained earnings                                              11(b)              1,661,487        2,062,571
AFS reserve                                                                           4,535         (483,963)
NET ASSETS ATTRIBUTABLE TO UNITHOLDERS                                          220,939,751      219,734,003

NUMBER OF UNITS IN CIRCULATION (UNIT)                          11(a)            219,030,772      217,467,801

NAV PER UNIT (RM)                                                                      1.0087         1.0104

The accompanying notes form an integral part of the audited financial statements.

                                                        13
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

STATEMENT OF CHANGES IN EQUITY
FOR THE FINANCIAL YEAR ENDED 31 JANUARY 2018

                                         Unitholders'          Retained                   AFS
                                              capital          earnings               reserve            Total
                                          Note 11(a)          Note 11(b)            Note 11(c)          equity
                                                 RM                 RM                     RM             RM

At 1 February 2016                        171,557,732          2,139,485            (1,255,531)   172,441,686
Total comprehensive income
  for the financial year                            -          6,937,168              771,568       7,708,736
Creation of units                          60,950,004                  -                    -      60,950,004
Reinvestment of units                       3,954,945                  -                    -       3,954,945
Cancellation of units                     (17,864,298)                 -                    -     (17,864,298)
Distributions (Note 12)                      (442,988)        (7,014,082)                   -      (7,457,070)
At 31 January 2017                        218,155,395          2,062,571             (483,963)    219,734,003

At 1 February 2017                        218,155,395          2,062,571             (483,963)    219,734,003
Total comprehensive income
  for the financial year                                       9,202,483              488,498        9,690,981
Creation of units                         135,401,734                  -                    -      135,401,734
Reinvestment of units                       7,487,183                  -                    -        7,487,183
Cancellation of units                    (141,900,338)                 -                    -     (141,900,338)
Distributions (Note 12)                       129,755         (9,603,567)                   -       (9,473,812)
At 31 January 2018                        219,273,729          1,661,487                4,535      220,939,751

The accompanying notes form an integral part of the audited financial statements.

                                                         14
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

STATEMENT OF CASH FLOWS
FOR THE FINANCIAL YEAR ENDED 31 JANUARY 2018

                                                                                         2018          2017
                                                                                          RM            RM

CASH FLOWS FROM OPERATING AND INVESTING
 ACTIVITIES

Payment for purchase of AFS financial assets                                   (136,941,045)     (32,292,624)
Proceeds from sales of AFS financial assets                                      97,300,510       20,109,874
Interest income received                                                         11,041,339        9,680,626
Manager's fee paid                                                               (1,367,809)      (2,794,599)
Trustee's fee paid                                                                 (113,984)         (90,944)
Payment of other fees and expenses                                                 (113,534)         (81,017)
Net cash used in operating and investing activities                             (30,194,523)      (5,468,684)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from creation of units                                                 142,888,917       64,904,949
Payment for redemption of units                                                (126,900,338)     (17,864,298)
Distributions to unitholders                                                     (8,355,214)      (6,762,627)
Net cash generated from financing activities                                      7,633,365       40,278,024

NET (DECREASE)/INCREASE IN CASH AND CASH
 EQUIVALENTS FOR THE FINANCIAL YEAR                                             (22,561,158)     34,809,340
CASH AND CASH EQUIVALENTS AT THE BEGINNING
 OF THE FINANCIAL YEAR                                                              47,215,842   12,406,502
CASH AND CASH EQUIVALENTS AT THE END OF THE
 FINANCIAL YEAR                                                                     24,654,684   47,215,842

Cash and cash equivalents comprise:
Cash at bank                                                                             1,684          842
Deposits with licensed financial institutions
 with maturity of less than 3 months (Note 7)                                       24,653,000   47,215,000
                                                                                    24,654,684   47,215,842

The accompanying notes form an integral part of the audited financial statements.
                                                        15
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 JANUARY 2018

1.    THE FUND, THE MANAGER AND THEIR PRINCIPAL ACTIVITIES

      Maybank Financial Institutions Income Fund (the "Fund”) was constituted pursuant to the execution of a
      Deed dated 5 November 2009, First Supplementary Deed dated 08 October 2012, and a Second
      Supplementary Deed dated 30 March 2015 (collectively referred to as "Deeds"), between the Manager,
      Maybank Asset Management Sdn. Bhd. (“Maybank AM”) and the Trustee, PB Trustee Services Berhad.

      The principal activity of the Fund is to invest up to 95% of its net asset value ("NAV") in RM-demoninated
      fixed income securities issued by financial institutions and/or bank guaranteed bonds. The remaining
      balance will be invested in fixed deposit and/or money market instruments.

      The Manager of the Fund is Maybank AM, a company incorporated in Malaysia. It is a holder of the Capital
      Markets Services Licence ("CMSL") with fund management as its regulated activity under the Capital
      Markets and Services Act 2007 ("CMSA"). The principal place of business of Maybank AM is at Level 12,
      Tower C, Dataran Maybank, No. 1 Jalan Maarof, 59000 Kuala Lumpur, Malaysia. Maybank AM is a wholly-
      owned subsidiary of Maybank Asset Management Group Berhad ("MAMG"), which in turn is a wholly-owned
      subsidiary of Malayan Banking Berhad ("MBB").

      The financial statements were authorised for issue by the Board of Directors ("the Directors") of the
      Manager in accordance with a resolution of the Directors on 30 March 2018.

2.1   Basis of preparation

      The financial statements of the Fund have been prepared in accordance with Malaysian Financial
      Reporting Standards (“MFRS”) as issued by the Malaysian Accounting Standards Board (“MASB”) and
      International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards
      Board (“IASB”).

      The Fund has adopted the MFRS, Amendments to Standards and Interpretations Committee ("IC")
      Interpretations which have become effective during the financial year ended 31 January 2018. The
      adoption of the new pronouncements did not result in any material impact to the financial statements.

      The financial statement are prepared on a historical cost basis except as disclosed in the accounting
      policies in Note 2.3 to Note 2.16 to the financial statements.

      The financial statements are presented in Ringgit Malaysia ("RM").

                                                        16
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.2   Standards, amendments and intepretations issued but not yet effective

      The following are standards and amendments to standards issued by the MASB, but not yet effective, up to
      the date of issuance of the Fund's financial statements. The Fund intends to adopt the relevant standards,
      if applicable, when they become effective.

                                                                                                 Effective for
                                                                                               annual periods
                                                                                                beginning on
      Description                                                                                     or after

      MFRS 2 Share-based Payment - Classification and Measurement of Share-based
       Payment Transactions (Amendments to MFRS 2)                                              1 January 2018
      MFRS 9 Financial Instruments (IFRS 9 issued by IASB in July 2014)                         1 January 2018
      MFRS 9 Prepayment Features with Negative Compensation
       (Amendments to MFRS 9)                                                                  1 January 2019
      MFRS 10 Consolidated Financial Statements - Sale or Contribution of Assets between     To be announced
        an Investor and its Associate or Joint Venture (Amendments to MFRS 10)                       by MASB
      MFRS 15 Revenue from Contracts with Customers                                            1 January 2018
      MFRS 16 Leases                                                                           1 January 2019
      MFRS 128 Investments in Associates and Joint Ventures - Sale or Contribution of
        Assets between an Investor and its Associate or Joint Venture (Amendments to          To be announced
        MFRS 128)                                                                                     by MASB
      MFRS 128 Long-term Interests in Associates and Joint Ventures (Amendments to
        MFRS 128)                                                                               1 January 2019
      Annual Improvements to MFRSs 2014 - 2016 Cycle
        (i) Amendments to MFRS 1 First-time Adoption of Malaysian Financial Reporting
               Standards                                                                        1 January 2018
        (ii) Amendments to MFRS 128 Investments in Associates and Joint Ventures                1 January 2018
      MFRS 140 Transfers of Investment Property (Amendments to MFRS 140)                        1 January 2018
      IC Interpretation 22 Foreign Currency Transactions and Advance Consideration              1 January 2018
      IC Interpretation 23 Uncertainty over Income Tax Treatments                               1 January 2019
      Annual Improvements to MFRSs 2015-2017 Cycle
        (i) Amendments to MFRS 3 Business Combinations and MFRS 11 Joint
               Arrangements                                                                     1 January 2019
        (ii) Amendments to MFRS 112 Income Tax                                                  1 January 2019
        (iii) Amendments to MFRS 123 Borrowing Costs                                            1 January 2019

                                                       17
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

2.2   Standards, amendments and intepretations issued but not yet effective (cont'd)

      The Fund expects that the adoption of the above standards will not have any material impact on the
      financial statements in the period of initial application except as discussed below:

      (i)   MFRS 9 Financial Instruments

            MFRS 9 replaces MFRS 139 Financial Instruments: Recognition and Measurement ("MFRS 139").
            MFRS 9 requires financial assets to be classified on the basis of the business model within which
            they are held and their contractual cash flow characteristic.

            The Fund will classify its financial assets in the following measurement categories:
            - those to be measured subsequently at fair value; and
            - those to be measured at amortised cost.
            There will be no changes to the subsequent measurement of these financial assets.

            MFRS 9 requires impairment assessments to be based on an expected loss model ("ECL"),
            replacing the MFRS 139 incurred loss model. The ECL model applies to financial assets measured
            at amortised cost.

            The Manager intends to adopt MFRS 9 on the mandatory effective date. On the date of the initial
            application, the AFS financial assets will be reclassified to financial assets at fair value through profit
            or loss, and AFS reserve will be transferred to non-distributable retained earnings. There will not be
            an impact to the performance results and the NAV of the Fund.

2.3   Financial assets

      Financial assets are recognised in the statement of financial position when, and only when, the Fund
      becomes a party to the contractual provisions of the financial instruments.

      When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial
      assets not at FVTPL, directly attributable transaction costs.

      The Fund determines the classification of its financial assets at initial recognition and categories applicable
      to the Fund are financial assets at AFS financial assets and loans and receivables. For investments, the
      classification depends on the purpose for which the investment were acquired.

      (a)   AFS financial assets

            Classification

            Available-for-sale ("AFS") financial assets are financial assets that are not classified in any other
            categories such as financial assets at fair value through profit or loss or loans and receivables. The
            Fund designates its investments in unquoted fixed income securities as AFS financial assets.

            Recognition and measurement

            Regular purchases of AFS financial assets are recognised on the trade date, the date on which the
            Fund commits to purchase the asset. AFS financial assets are initially recognised at fair value.
            Directly attributable transaction costs are included in the initial measurement of AFS financial assets.

                                                          18
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

2.3   Financial assets (cont'd)

      (a)   AFS financial assets (cont'd)

            Recognition and measurement (cont'd)

            After initial recognition, AFS financial assets are measured at fair value. Any gains and losses from
            changes in fair value of the AFS financial assets are recognised in other comprehensive income,
            except for impairment losses, foreign exchange gains and losses on monetary instruments, dividend
            income and interest income calculated using the effective interest method, which are recognised in
            statement of comprehensive income.

            When securities classified as AFS are sold or impaired, the accumulated fair value adjustments
            recognised in other comprehensive income are included in the statement of comprehensive income
            as 'net gains/(losses) from AFS financial assets'. Interest income on AFS debt investments
            calculated using the effective interest method is recognised in profit or loss.

            Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
            orderly transaction between market participants at the measurement date. The fair value for financial
            instruments traded in active markets at the reporting date is based on their quoted price or binding
            dealer price quotations, without any deduction for transaction costs.

      (b)   Loans and receivables

            Classification

            Non-derivative financial assets with fixed or determinable payments that are not quoted in an active
            market are classified as loans and receivables. Financial assets classified in this category comprise
            cash at bank, deposits with licensed financial institutions and interest income receivables.

            Recognition and measurement

            Subsequent to initial recognition, loans and receivables are measured at amortised cost using the
            effective interest rate method. Gains and losses are recognised in the profit and loss when the loans
            and receivables are derecognised or impaired, and through the amortisation process.

2.4   Derecognition of financial assets

      A financial asset is derecognised when:

      (1)   The rights to receive cash flows from the asset have expired; or

      (2)   The Fund has transferred its rights to receive cash flows from the financial asset or have assumed
            an obligation to pay the received cash flows in full without material delay to a third party under a
            "pass through" arrangement; and either:

              -   the Fund has transferred substantially all the risks and rewards of the financial assets; or

              -   the Fund has neither transferred nor retained substantially all the risks and rewards, but has
                  transferred control of the financial asset.

                                                        19
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

2.4   Derecognition of financial assets (cont'd)

      On derecognition of a financial asset in its entirety, the difference between the carrying amount and the
      sum of the consideration received and any cumulative gain or loss that had been recognised in other
      comprehensive income, if any, is recognised in profit or loss.

2.5   Impairment of financial assets

      The Manager assesses at each reporting date of the Fund whether there is any objective evidence that a
      financial asset of the Fund is impaired.

      (a)   AFS financial assets

            Significant or prolonged decline in fair value below cost, significant financial difficulties of the issuer
            or obligor and the disappearance of an active trading market are considerations to determine
            whether there is objective evidence that investment securities classified as AFS financial assets are
            impaired.

            If an AFS financial asset is impaired, an amount comprising the difference between its cost (net of
            any principal payment and amortisation) and its current fair value, less any impairment loss
            previously recognised in profit or loss, is transferred from equity to profit or loss.

            Impairment losses on AFS equity investments are not reversed through profit or loss; increases in
            fair value after impairment are recognised in other comprehensive income. For AFS debt
            investments, impairment losses are subsequently reversed in profit or loss, up to the amount
            previously recognised as impairment loss, if an increase in the fair value of the investment can be
            objectively related to an event occurring after the recognition of the impairment loss in profit or loss.

      (b)   Loans and receivables

            To determine whether there is objective evidence that an impairment loss on financial assets has
            been incurred, the Fund considers factors such as the probability of insolvency or significant
            financial difficulties of the debtor and default or significant delay in payments.

            If any such evidence exists, the amount of impairment loss is measured as the difference between
            the carrying amount and the present value of estimated future cash flows discounted at the financial
            asset's original effective interest rate. The impairment loss is recognised in profit or loss.

            The carrying amount of the financial asset is reduced by the impairment loss directly for all financial
            assets with the exception of trade receivables, where the carrying amount is reduced through the
            use of an allowance account. When a trade receivable becomes uncollectible, it is written-off against
            the allowance account.

            If in a subsequent period, the amount of the impairment loss decreases and the decrease can be
            related objectively to an event occurring after the impairment was recognised, the previously
            recognised impairment loss is reversed to the extent that the carrying amount of the financial asset
            does not exceed its amortised cost at the reversal date. The amount of reversal is recognised in
            profit or loss.

                                                          20
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

2.6   Financial liabilities

      Classification

      Financial liabilities are classified according to the substance of the contractual arrangements entered into
      and the definitions of a financial liability.

      The Fund classifies amount due to Manager, amount due to Trustee, distributions payable and other
      payables and accruals as financial liabilities.

      Recognition and measurement

      Financial liabilities are recognised in the statement of financial position when, and only when, the Fund
      becomes a party to the contractual provisions of the financial instrument.

      The Fund’s financial liabilities are recognised initially at fair value plus directly attributable transaction costs
      and subsequently measured at amortised cost using the effective interest rate method.

      A financial liability is derecognised when the obligation under the liability is extinguished. Gains and losses
      are recognised in profit or loss when the liabilities are derecognised, and through the amortisation process.

2.7   Fair value measurement

      The Fund measures its financial instruments at fair value, at each reporting date. Fair value is the price that
      would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
      participants at the measurement date. The fair value measurement is based on the presumption that the
      transaction to sell the asset or transfer the liability takes place either:

      (i)    In the principal market for the asset or liability; or

      (ii)   In the absence of a principal market, in the most advantageous market for the asset or liability.

      The principal or the most advantageous market must be accessible by the Fund.

      The fair value of an asset or a liability is measured using the assumptions that the market participants
      would use when pricing the asset or liability, assuming that the market participants act in their economic
      best interest.

      A fair value measurement of a non-financial asset takes into account a market participant’s ability to
      generate economic benefits by using the asset in its highest and best use or by selling it to another market
      participant that would use the asset in its highest and best use.

      All assets and liabilities for which fair value is measured or disclosed in the financial statements are
      categorised within the fair value hierarchy, described as follows, based on the lowest level input that is
      significant to the fair value measurement as a whole:

                                                             21
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

2.7   Fair value measurement (cont'd)

      (i)     Level 1   –    Quoted (unadjusted) market prices in active markets for identical assets or liabilities.

      (ii)    Level 2   –    Valuation techniques for which the lowest level input that is significant to the fair value
                             measurement is directly or indirectly observable.

      (iii)   Level 3   –    Valuation techniques for which the lowest level input that is significant to the fair value
                             measurement is unobservable.

      For assets and liabilities that are recognised in the financial statements on a recurring basis, the Fund
      determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation
      (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of
      each reporting date.

      For the purpose of fair value disclosures, the Fund has determined classes of assets and liabilities on the
      basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy
      as explained above.

2.8   Functional and presentation currency

      The financial statements of the Fund are measured using the currency of the primary economic
      environment in which the Fund operates (the "functional currency”). The financial statements are presented
      in Ringgit Malaysia, which is also the Fund’s functional currency.

2.9   Unitholders' capital

      The unitholders’ contributions to the Fund meet the criteria to be classified as equity instruments under
      MFRS 132 Financial Instruments: Presentation. Those criteria include:

      (i)     the units entitle the holder to a proportionate share of the Fund’s NAV;

      (ii)    the units are the most subordinated class and class features are identical;

      (iii)   there is no contractual obligations to deliver cash or another financial asset other than the obligation
              on the Fund to repurchase; and

      (iv)    the total expected cash flows from the units over its life are based substantially on the profit or loss
              of the Fund.

      The outstanding units are carried at the redemption amount that is payable at each financial year if
      unitholder exercises the right to put the unit back to the Fund. Units are created and cancelled at prices
      based on the Fund's NAV per unit at the time of creation or cancellation. The Fund's NAV per unit is
      calculated by dividing the net assets attributable to unitholders with the total number of outstanding units.

      Distribution equalisation represents the average distributable amount included in the creation and
      cancellation prices of units. This amount is either refunded to unitholders by way of distribution and/or
      adjusted accordingly when units are cancelled.

                                                           22
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

2.10 Distributions

     Any distribution to the Fund’s unitholders is accounted for as a deduction from realised reserves except
     where distribution is sourced out of distribution equalisation which is accounted for as a deduction from
     unitholders’ capital. A proposed distribution is recognised as a liability in the financial year in which it is
     approved.

2.11 Cash and cash equivalents

     Cash and cash equivalents comprise cash at bank and deposits with licensed financial institutions with
     original maturity of three (3) months or less which have an insignificant risk of changes in value.

2.12 Interest income

     Interest income is recognised to the extent that it is probable that the economic benefits will flow to the
     Fund and the income can be reliably measured. interest income is measured at the fair value of
     consideration received or receivable.

     Interest income from unquoted fixed income securities includes amortisation of premium and accretion of
     discount, and is recognised using the effective interest rate method.

     Interest income from deposits with licensed financial institutions is recognised on the accruals basis using
     the effective interest rate method.

     Realised gain or loss on disposal of unquoted fixed income securities is accounted for as the difference
     between the net disposal proceeds and the carrying amount of the investments, determined on cost
     adjusted for accretion of discount or amortisation or premium.

2.13 Income tax

     Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
     tax authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
     substantively enacted by the reporting date.

     Current taxes are recognised in profit or loss, except to the extent that the tax relates to items recognised
     outside profit or loss, either in other comprehensive income or directly in equity.

     Current tax expense is determined according to Malaysian tax laws at the current tax rate based upon the
     taxable profit earned during the financial year.

     No deferred tax is recognised as no temporary differences have been identified.

2.14 Segment reporting

     Operating segments are reported in a manner consistent with the internal reporting used by the chief
     operating decision-maker. The chief operating decision-maker is responsible for allocating resources and
     assessing performance of the operating segments.

                                                        23
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

2.15 Amount due from/to brokers

     Amount due from and amount due to brokers represent receivables for investments sold and payables for
     investments purchased that have been contracted for but not yet settled or delivered on the statement of
     financial position date respectively.

     These amounts are recognised initially at fair value and subsequently measured at amortised cost using the
     effective interest rate method, less provision for impairment for amounts due from brokers. A provision for
     impairment of amount due from brokers is established when there is objective evidence that the Fund will
     not be able to collect all amounts due from the relevant broker. Significant financial difficulties of the broker,
     probability that the broker will enter bankruptcy or financial reorganisation, and default in payments are
     considered indicators that the amount due from brokers is impaired. Once a financial asset or a group of
     similar financial assets has been written-down as a result of an impairment loss, interest income is
     recognised using the rate of interest rate used to discount the future cash flows for the purpose of
     measuring the impairment loss.

2.16 Critical accounting estimates and judgements

     The Fund makes estimates and assumptions concerning the future. The resulting accounting estimates will,
     by definition, rarely equal the related actual results. To enhance the information content of the estimates,
     certain key variables that are anticipated to have material impact to the Fund’s results and financial position
     are tested for sensitivity to changes in the underlying parameters.

     Estimates and judgements are continually evaluated by the Manager and are based on historical
     experience and other factors, including expectations of future events that are believed to be reasonable
     under the circumstances.

     In undertaking any of the Fund’s investment, the Manager will ensure that all assets of the Fund will be
     valued appropriately, that is at fair value and in compliance with the SC Guidelines on Unlisted Capital
     Market Products Under the Lodge and Launch Framework.

     RM-denominated unquoted fixed income securities are valued using fair value prices quoted by BPA.
     Where the Manager is of the view that the price quoted by BPA for a specific fixed income security differs
     from the market price by more than 20 basis points, the Manager may use the market price, provided that
     the Manager records its basis for using a non-BPA price, obtains necessary internal approvals to use the
     non-BPA price, and keeps an audit trail of all decisions and basis for adopting the use of non-BPA price.

3.   INTEREST INCOME

                                                                                            2018                2017
                                                                                             RM                  RM

     Interest income from unquoted fixed income securities                           11,122,811            9,036,229
     Interest income from deposits with licensed financial institutions                 834,295              774,814
     Amortisation of premium, net of accretion of discount                           (1,466,453)          (1,547,658)
                                                                                     10,490,653            8,263,385

4.   MANAGER'S FEE

     The Manager's fee is computed on a daily basis at 0.60% (2017: 0.60%) per annum ("p.a.") of the NAV of
     the Fund before deducting the Manager's fee and Trustee's fees for that particular day.

                                                          24
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

5.   TRUSTEE'S FEE

     The Trustee's fee is computed on a daily basis at 0.05% p.a.(2017: 0.05%) of the NAV of the Fund before
     deducting the Manager's fee and Trustee's fees for that particular day, subject to a minimum fee of
     RM18,000 per annum.

6.   INCOME TAX EXPENSE
                                                                                        2018                2017
                                                                                         RM                  RM

     Tax expense for the financial year:

     Current income tax expense                                                             -                   -

     Income tax is calculated at the Malaysian statutory tax rate of 24% (2017: 24%) of the estimated
     assessable income for the financial year. The tax charge for the financial year is in relation to the taxable
     income earned by the Fund after deducting tax allowable expenses. In accordance with Schedule 6 of the
     Income Tax Act 1967, the interest income earned by the Fund from investment is exempted from tax.

     A reconciliation of income tax expense applicable to net income before taxation at the statutory income tax
     rate to income tax expense at the effective income tax rate is as follows:

                                                                                        2018                2017
                                                                                         RM                  RM

     Net income before taxation                                                    9,202,483          6,937,168

     Tax at Malaysian statutory rate of 24% (2017: 24%)                            2,208,596           1,664,920
     Effects of income not subject to tax                                         (2,593,097)         (1,975,233)
     Effects of expenses not deductible for tax purposes                             384,501             310,313
     Tax expense for the financial year                                                    -                   -

7.   DEPOSITS WITH LICENSED FINANCIAL INSTITUTIONS

                                                                                        2018                2017
                                                                                         RM                  RM

     Deposits with licensed financial institutions
      with maturity of less than 3 months                                         24,653,000         47,215,000

     The weighted average effective interest rates (“WAEPR”) p.a. and average maturity of deposits with
     licensed financial institutions as at the reporting date are as follows:

                                                        2018                                2017
                                                                 Average                                Average
                                                 WAEIR           maturity             WAEIR             maturity
                                                 % p.a.             Days              % p.a.               Days

     Deposits with maturity
      of less than 3 months                          3.29               3                3.52                  5

                                                            25
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

8.   AFS FINANCIAL ASSETS

     AFS financial assets comprise investments in RM-denominated unquoted fixed income securities issued in
     Malaysia.

                                                                                      2018           2017
                                                                                       RM             RM

     Unquoted fixed income securities                                         212,686,329     173,709,834

     The composition of AFS financial assets as at 31 January 2018 are as follows:

                                                                                              Percentage
                                                             Aggregate               Market           of
                                            Quantity              cost                value         NAV
     Name of issuer                            Unit                RM                   RM            %

     2018

     Unquoted fixed income
      securities

     Ambank Islamic Bhd
      - 4.45% / 06.03.2020                 5,000,000          5,022,166          5,007,250            2.27

     CIMB Bank Bhd
       - 5.15% / 23.12.2025                5,000,000          5,063,792          5,072,100            2.30

     Malayan Banking Bhd
     - 4.20% / 20.02.2032                 15,000,000        15,000,000         15,033,750             6.80

     Bank Muamalat Malaysia Bhd
     - 5.50% / 25.11.2021                  9,000,000          9,030,045          9,104,760            4.12

     Affin Bank Bhd
     - 5.03% / 20.09.2027                 10,000,000        10,031,755         10,066,700             4.56

     Affin Bank Bhd
     - 5.45% / 05.02.2027                 19,000,000        19,333,199         19,426,740             8.79

     Ambank Islamic Bhd
     - 8.25% / 19.08.2019                  5,000,000          5,254,022          5,262,650            2.38

     Ambank Islamic Bhd
     - 5.20% / 15.03.2027                 15,000,000        15,159,360         15,180,000             6.87

     CIMB Bank Bhd
     - 6.70% / 05.10.2018                  5,000,000          5,060,225          5,074,050            2.30

                                                       26
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

8.   AFS FINANCIAL ASSETS (CONT'D)

                                                                                 Percentage
                                                       Aggregate       Market            of
                                       Quantity             cost        value          NAV
     Name of issuer                       Unit               RM           RM             %

     2018 (cont'd)

     Unquoted fixed income
      securities (cont'd)

     CIMB Group Holdings Bhd
     - 6.35% / 03.04.2020            15,000,000        15,533,019   15,476,850         7.01

     CIMB Bank Bhd
     - 4.80% / 23.12.2025             4,000,000         4,016,113    4,026,680         1.82

     CIMB Islamic Bank Bhd
     - 5.85% / 25.09.2019             1,200,000         1,227,050    1,227,876         0.56

     CIMB Bank Bhd
     - 5.80% / 25.05.2021            10,000,000        10,241,013   10,216,400         4.62

     CIMB Bank Bhd
     - 5.60% / 05.07.2024            15,000,000        15,190,599   15,145,800         6.86

     Hong Leong Bank Bhd
     - 4.50% / 24.06.2019             4,200,000         4,202,748    4,208,190         1.90

     HSBC Bank Malaysia Bhd
     - 5.05% / 02.11.2022             8,910,000         9,158,565    9,052,471         4.10

     Krung Thai Bank PCL
     - 5.10% / 04.07.2025             5,000,000         5,009,528    5,070,550         2.29

     Malayan Banking Bhd
      - 6.30% / 25.09.2018            5,000,000         5,060,969    5,062,600         2.29

     National Bank of Abu Dhabi
      - 4.75% / 09.12.2027            5,500,000         5,476,230    5,474,040         2.48

     Public Bank Bhd
       - 7.50% / 05.06.2019          19,700,000        20,443,606   20,436,977         9.25

     Public Bank Bhd
       - 4.85% / 23.04.2027           3,000,000         3,025,147    3,022,350         1.37

                                                  27
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

8.   AFS FINANCIAL ASSETS (CONT'D)

                                                                                        Percentage
                                                             Aggregate        Market            of
                                            Quantity              cost         value          NAV
     Name of issuer                            Unit                RM            RM             %

     2018 (cont'd)

     Unquoted fixed income
      securities (cont'd)

     RHB Bank Bhd
      - 4.82% / 27.09.2027                 5,000,000          5,000,000     5,005,250         2.27

     RHB Bank Bhd
      - 8.00% / 31.03.2039                 5,000,000          5,304,522     5,189,950         2.35

     RHB Bank Bhd
      - 5.60% / 29.04.2020               14,500,000          14,838,122    14,842,345         6.72

     Total unquoted
       fixed income
       securities                       209,010,000         212,681,794   212,686,329        96.26

     Unrealised gain on financial assets at FVTPL                               4,535

     2017

     Unquoted fixed income
      securities

     Ambank Islamic Bhd
     - 4.45% - 06/03/2020                  5,000,000          5,032,169     4,993,950         2.27

     Ambank Bhd
     - 8.25% - 18/08/2039                  5,000,000          5,408,950     5,406,350         2.46

     Ambank Bhd
     - 4.30% - 25/03/2019                  5,000,000          5,012,257     4,990,050         2.27

     CIMB Group Holdings Bhd
     - 5.80% - 25/05/2021                  5,000,000          5,000,000     5,098,650         2.32

     CIMB Group Holdings Bhd
     - 6.35% - 5/04/2060                 14,000,000          14,714,683    14,605,640         6.65

     CIMB Bank Bhd
     - 4.80% - 13/09/2023                  2,800,000          2,806,258     2,814,644         1.28

                                                       28
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

8.   AFS FINANCIAL ASSETS (CONT'D)

                                                                                 Percentage
                                                       Aggregate       Market            of
                                       Quantity             cost        value          NAV
     Name of issuer                       Unit               RM           RM             %

     2017 (cont'd)

     Unquoted fixed income
      securities (cont'd)

     CIMB Bank Bhd
     - 4.80% - 23/12/2025             9,000,000         9,046,921    9,013,140         4.10

     CIMB Bank Bhd
     - 6.70% - 07/10/2038             5,000,000         5,146,737    5,159,500         2.35

     CIMB Islamic Bank Bhd
     - 5.85% - 25/09/2024             1,000,000         1,035,820    1,032,450         0.47

     CIMB Thai Bank PCL
     - 5.35% - 10/07/2026             5,000,000         5,000,000    5,010,400         2.28

     CIMB Thai Bank PCL
     - 5.60% - 05/07/2024             4,900,000         4,963,583    4,952,577         2.25

     Hong Leong Bank Bhd
     - 4.50% - 21/06/2024             9,200,000         9,210,445    9,180,680         4.18

     HSBC Bank Malaysia Bhd
     - 5.05% - 2/11/2027              8,910,000         9,204,750    9,098,090         4.14

     Krung Thai Bank PCL
     - 5.10% - 04/07/2025            10,000,000        10,021,125   10,187,200         4.64

     Malayan Banking Bhd
     - 6.30% - 25/09/2068             4,500,000         4,639,356    4,598,775         2.09

     Malayan Banking Bhd
     - 4.25% - 10/05/2024            15,000,000        15,015,700   14,814,150         6.74

     Bank Muamalat Malaysia
       Bhd
     - 5.50% - 25/11/2021             5,000,000         5,000,000    5,036,250         2.29

     National Bank of Abu Dhabi
     - 4.75% - 09/12/2027              500,000           490,400      497,080          0.23

     Public Bank Bhd
     - 7.50% - 05/06/2059            24,700,000        26,295,176   26,172,614        11.91

                                                  29
MAYBANK FINANCIAL INSTITUTIONS INCOME FUND

8.   AFS FINANCIAL ASSETS (CONT'D)

                                                                                                  Percentage
                                                             Aggregate              Market                of
                                            Quantity              cost               value              NAV
     Name of issuer                            Unit                RM                  RM                 %

     2017 (cont'd)

     Unquoted fixed income
      securities (cont'd)

     Public Bank Bhd
     - 4.80% - 25/09/2023                  4,000,000          4,019,530          4,017,760               1.83

     Public Bank Bhd
     - 4.77% - 27/10/2023                  2,000,000          2,005,190          2,007,940               0.91

     RHB Bank Bhd
     - 5.60% - 29/04/2025                 14,500,000         14,978,968         14,878,740               6.77

     RHB Bank Bhd
     - 8.00% - 31/03/2039                  5,000,000          5,333,287          5,320,500               2.42

     RHB Bank Bhd
     - 4.99% - 08/07/2024                  4,800,000          4,812,492          4,822,704               2.19

     Total unquoted fixed
       income securities                 169,810,000        174,193,797       173,709,834               79.05

     Unrealised loss on financial assets at FVTPL                                 (483,963)

9.   DUE TO MANAGER

                                                                                      2018               2017
                                                              Note                     RM                 RM

     Redemption of units                                       (i)              15,000,000                  -
     Manager's fee                                             (ii)                125,923            112,440
                                                                                15,125,923            112,440

     (i)    The amount represents amount payable to the Manager for units redeemed.

     (ii)   The amount represents the amount payable to the Manager arising from the accruals for Manager's
            fee at the end of the financial year. The normal credit term for Manager's fee is 15 days (2017: 15
            days).

                                                       30
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