Annual Report 2019

RISK OVERVIEW Risk Management is fundamental to Cim Group’s strategy, profitability and to the day-to-day management of its risk- taking activities. The strategy is well-informed and shaped by an understanding of the risk landscape, including a range of significant risks and uncertainties in the external economic, competitive and regulatory environment. Any identified inherent risks to the core business activities are managed through an integrated Enterprise Risk Management (ERM) framework with the objective of adopting a prudent and disciplined approach whilst striking an appropriate balance between risk and return. The key risk types include credit risk, market risk, liquidity risk, funding risk, business risk, operational risk and reputational risk, and these are managed effectively through an internal governance process and the use of risk management tools and processes. The Board is fully committed to establishing a sound system of risk oversight in relation to risk management, adherence to internal policies and compliance with the prudential regulatory and legal requirements. STRATEGY AND BUSINESS OBJECTIVES (stakeholders expectations) Risk Appetite Framework incorporating Board approved top-down risk appetite statements Capital Management Ensures adequate capital is available at all times to implement future strategy and protect us from unexpected loss Credit Risk management Assesses the credit worthiness of our customer’s ability to repay its contractual obligations Market Risk management Assesses the risk that the future interest income deteriorates if market rates change Funding & Liquidity risk management Ensures the Group can finance its liquidity needs through diverse funding sources in accordance with its strategy Non-financial risks Ensures we respond to risk in a timely and effective way and implement appropriate control measures to ensure business integrity Reporting We seek to provide reliable information both internally and externally through improved reporting and data management Our approach to identification and impact assessment aims to ensure that the Group mitigates the impact of these risks on its financial results, long-term strategic goals and reputation. CIM FINANCIAL SERVICES LTD / ANNUAL REPORT 2019 Risk Management 50