AmBank: Weaknesses in reporting system led to RM53.7 million penalty

PETALING JAYA: AMMB Holdings Bhd (AmBank Group) said a RM53.7 million fine by Bank Negara Malaysia (BNM) announced last week was the result of weaknesses in its reporting systems and processes in place “at the time”, as well as inadequate skills on the part of some of its staff.

The banking group did not elaborate on the incidence/incidences which had led to the findings of its weaknesses.

AmBank Group’s announcement was in response to a query made by Bursa Malaysia last Tuesday, for further details on the compliance issues which had led to the penalty imposed by BNM.

“The non-compliance did not result in financial losses either to AmBank Group, save for the penalty, or to its customers. BNM has not placed any restrictions on the business operations of AmBank Group,” it said in the filing.

On remedial actions it has taken to mitigate the issue/issues it had, AmBank Group said it has strengthened its compliance function, and recruited a number of senior and experienced officers.

“For all of its staff, AmBank Group has increased and enhanced training and awareness programmes and, at the same time, senior management and the respective boards have heightened the oversight and improved the check and balance processes,” it noted.

Last Monday, AmBank Group announced that it had agreed to pay a penalty of RM53.7 million to Bank Negara for non-compliance by its consumer banking and Islamic banking units.

In addition to the penalty, the AmBank Group agreed with the central bank to work on a four-year programme towards achieving market best practices, with an average allocation of RM25 million a year for investment in systems, infrastructure and training.

Earlier this year, AmBank Group was thrown into the limelight for purportedly being the bank in which Prime Minister Datuk Seri Najib Abdul Razak received RM2.6 billion in. Najib has since said that the monies were political donations.