Bank Islam Integrated Annual Report 2022

40 Years of Advancing Prosperity for All INTEGRATED REPORT 2022

About Our Report CONTENTS • Provides a comprehensive overview of the Group’s performance for 2022 and the outlook for 2023 REGULATIONS COMPLIED • Malaysian Financial Reporting Standard • Companies Act 2016 • Bursa Malaysia’s Sustainability Reporting Guide • FTSE4Good Bursa Malaysia • Global Reporting Initiative G4 • Malaysian Code on Corporate Governance (MCCG 2021) SCOPE AND BOUNDARY OF REPORTING This Integrated Annual Report (IAR) is produced and published annually and covers our financial and non-financial performance for the reporting period of 1 January 2022 to 31 December 2022 unless otherwise stated. The report provides a complete and balanced review of the primary activities of the Group, namely our overall performance and the delivery of initiatives towards achieving our goals, providing material information relating to our strategy and business model, operating environment, material risks, stakeholder interests, performance, governance and prospects. The boundary of the report extends beyond financial reporting. It includes non-financial performance, opportunities, risks and outcomes attributable to/or associated with our key stakeholders, which significantly influence our ability to create value. REPORTING FRAMEWORKS BIMB’s integrated reporting process, as well as the contents of this report, are guided by the principles and requirements of the following: • Value Reporting Foundation (VRF) • Malaysian Code on Corporate Governance (MCCG 2021) by Securities Commission Malaysia • Companies Act 2016 • Bank Negara Malaysia Corporate Governance Policy Our financial statements for the Financial Year Ended 31 December 2022 have been prepared in accordance with the following: • Malaysian Financial Reporting Standards (MFRS) • International Financial Reporting Standards (IFRS) • Companies Act 2016 • Bank Negara Malaysia Policy Documents and Guidelines • Islamic Financial Services Act 2013 Corporate Book STRATEGIC FOCUS AREAS MATERIAL MATTERS KEY RISKS How to navigate our report CAPITALS Sustainable Prosperity SP Real Economy RE Customercentricity CC Values-based Culture VBC Community Empowerment CE Digitalisation D Manufactured Financial Intellectual Human Social and Relationship Natural Credit Risk Market Risk Liquidity Risk Operational Risk Information Technology (IT) Risk Shariah Non-Compliance (SNC) Risk Regulatory/ Compliance Risk Climate Risk Sustainable Economic Performance Customer Experience Purposeful Financial Services Environmental Stewardship Community Enrichment Energy and Climate Change Talent and Development Employee Wellbeing, Health and Safety Diversity & Inclusion

This report can be accessed online via BIMB website: MATERIALITY AND MATERIAL MATTERS This report aims to disclose information about matters that substantively affect our ability to create value over the short, medium and long-term and to deliver on our core purpose. A thorough assessment of material issues to BIMB was conducted in 2022. Material issues were identified based on evaluating how we create value, the impact of the external operating context on the value creation, our stakeholders’ material interest, and the principal risks facing the Group. The content of this report focuses on the issues, opportunities and challenges that are material to both our stakeholders and our business, which consequently impacts our performance. By applying the principle of materiality to our reporting disclosures, we present vital topics that influence the Group’s strategy for creating long-term value for our key stakeholders. COMBINED ASSURANCE Our robust internal control and good governance practices support the report development process. Our Board of Directors (Board) provides assurance for this report, supported by external verification by PwC Malaysia, our auditors for financial information and providers of limited assurance on selected non-financial information. FORWARD-LOOKING STATEMENTS This IAR contains certain forward-looking statements about BIMB’s future performances and prospects. These statements and forecasts are based on current assumptions, judgements and involve uncertainties as circumstances may change. Various factors may cause actual results to differ materially from those expressed or implied by these forward-looking statements, such as several emerging risks and other factors that could adversely impact our business and financial performance. As such, these forwardlooking statements should not be construed as guarantees to BIMB’s future performance. APPROVAL BY THE BOARD BIMB’s Board acknowledges its responsibility in ensuring the integrity of this IAR, which in the Board’s opinion, addresses material issues to the Group’s ability to create value and fairly presents BIMB’s performance for the year 2022. This Annual Report for the financial year ended 31 December 2022 was approved by the Board on 19 April 2023, and signed on its behalf by: Tan Sri Dr Ismail Haji Bakar Chairman STAKEHOLDERS UN SDGs Investors Government & Regulators Employees Customers Local Communities Labour Standards and Practises Sustainable Supply Chain Collaboration and Partnerships Corporate Governance and Business Ethics Data Privacy and Security Risk Management

OVERVIEW OF BIMB 01 4 Vision | Mission | Our Brand Promise | TAAT Values | Who We Are | Highlights 5 2022 Key Highlights • Financial Highlights • Business Highlights • Sustainability Highlights 6 Awards & Recognition 7 Our Competitive Advantages 8 Our Presence 10 What We Do: Core Businesses 11 Our Products & Services 12 How We Are Structured 13 Significant Events 2022 VALUE CREATION AT BIMB 03 30 Our Integrated Approach to Value Creation 32 Our Value Creating Business Model 34 Performance by Capitals 38 Stakeholder Needs and Expectations Inside Our Report Bank Islam Malaysia Berhad (BIMB) has been at the forefront of advancing prosperity for all our customers for 40 years. As we move forward, we remain committed to our core objective of creating sustainable value for our stakeholders. To achieve this, we have redefined our growth strategy and embraced innovative methods to future-proof our business. Our LEAP25 business strategy roadmap underpins our transformation journey, as we focus on driving sustainability, pursuing new opportunities, accelerating digital initiatives, and enhancing efficiency. At the heart of our transformation programme is a customer-centric approach, coupled with our broad range of offerings and comprehensive digitalisation efforts. We believe this approach will help us to create new growth opportunities, while also enabling us to contribute to sustainability, green financing, Shariah-ESG and ESGcompliant investing. As we celebrate 40 years of advancing prosperity for all, we are proud of our achievements and excited about the opportunities ahead. We remain committed to delivering innovative solutions and unparalleled customer experiences, while staying true to our values of integrity, excellence, and social responsibility. The cover design features an illustration of a skyline with Bank Islam at the forefront of advancing prosperity for the nation. Rationale About Our Report KEY MESSAGES 02 16 From the Desk of the Chairman 19 Group Chief Executive Officer Statement 27 Financial Review by the Group Chief Financial Officer 40th Annual General Meeting of Bank Islam Malaysia Berhad Online Broadcast Venue, Level 10, Menara Bank Islam, 22 Jalan Perak, 50450 Kuala Lumpur Friday, 26 May 2023 10.00 a.m

MANAGEMENT DISCUSSION AND ANALYSIS SUSTAINABILITY STATEMENT FINANCIAL STATEMENTS LEADERSHIP 04 05 08 06 A. STRATEGIC REVIEW 40 Operating Environment 41 Key Market Trends Shaping Our Business 44 Material Matters 48 Key Risks and Mitigations 52 Our Strategic Roadmap: LEAP25 54 Strategic Performance Review 60 Key Performance Indicators B. PERFORMANCE REVIEW 62 5-Year Financial Summary 63 5-Year Financial Highlights 64 Financial by Contract 65 Segmental Analysis 66 Simplified Statements of Financial Position 67 Statement of Value-added & Distribution 68 Quarterly Performance 69 Financial Calendar C. BUSINESS REVIEW 70 Consumer Banking 75 Deposits and Cash Management 80 SME Banking 84 Corporate Banking 89 Commercial Banking 95 Treasury and Markets 98 BIMB Investment 104 BIMB Securities 108 Sustainability Overview 110 Sustainability Dashboard 111 Sustainability @ BIMB 113 Sustainability Governance 115 Economic Impact 122 Environmental Impact 125 Social Impact 142 Good Governance ACCOUNTABILITY 07 178 Corporate Governance Overview Statement 201 Additional Compliance Information 202 Board Audit & Examination Committee (BAEC) Report 208 Statement on Risk Management and Internal Control 223 Directors’ Report 230 Statement by Directors 231 Report of the Shariah Supervisory Council 237 Statutory Declaration 238 Independent Auditors’ Report 242 Statements of Financial Position 243 Statements of Profit or Loss 244 Statements of Other Comprehensive Income 245 Consolidated Statement of Changes in Equity 249 Statements of Cash Flow 253 Notes to the Financial Statements 383 Pillar 3 Disclosure 154 Corporate Information 156 Board Composition 157 Board of Directors’ Profile 167 Shariah Supervisory Council’s Profile 170 Profile of Management Team 176 Heads of Subsidiaries’ Profile 177 Organisation Structure ADDITIONAL INFORMATION 09 443 Shareholdings’ Analysis 446 Properties Owned by BIMB Group 447 Directory of Main and Regional Offices 451 Ar-Rahnu Branches 453 SME Hub 454 Bureau de Change 455 Vehicle Financing Sales Hub 457 Subsidiaries of BIMB Group 458 GRI Context Index 462 Notice of the 40th Annual General Meeting 469 Statement Accompanying Notice of the 40th Annual General Meeting 470 Administrative Guide Form of Proxy

VISION The bank that advances prosperity for all MISSION To provide solutions that deliver value Bank Islam, Malaysia’s first Islamic Bank, was established on 1 July 1983 (20 Ramadan 1403H) and listed on the Main Market of Bursa Malaysia on 8 October 2021 as Malaysia’s first publicly listed Islamic bank. A full-fledged and pure-play Islamic bank with 135 branches and over 900 selfservice terminals nationwide, Bank Islam provides banking and financial solutions that strictly adhere to the Shariah rules and principles and are committed to the ideals of sustainable prosperity and ESG values. Our core subsidiaries, BIMB Investment Management Berhad and BIMB Securities Sdn Bhd, are pioneers in various Islamic financial services. We strive to create opportunities and improve lives by offering end-to-end financial solutions for our diverse customers, stakeholders, and communities. As the leading Islamic bank in Malaysia, we nurture responsible growth and progress, using our expertise and experience to help our customers achieve success and build a sustainable future for all. WHO WE ARE HIGHLIGHTS MARKET CAPITALISATION RM5.9 billion TAAT VALUES Think Customer Act with Integrity Advance Beyond Take Charge OUR BRAND PROMISE Assuring Trust. Delivering Value. PRESENCE 135 branches in Malaysia DIVIDEND PAID 13.80 sen REVENUE RM3.6 billion TOTAL CUSTOMERS >5.7 million PROFIT BEFORE ZAKAT & TAX RM746.9 million TOTAL EMPLOYEES 4,744 Integrated Report 2022 4 Overview of BIMB

ASSET GROWTH 12.1% (2021: 7.4%) FINANCING GROWTH 11.6% (2021: 6.4%) BUSINESS HIGHLIGHTS FINANCIAL HIGHLIGHTS SUSTAINABILITY HIGHLIGHTS cloud -based ECONOMIC SOCIAL ENVIRONMENTAL Won The E-Commerce – Financial Services Award at the Malaysia Technology Excellence Awards 2022 Launched Be U by Bank Islam, a fully cloud-native digital banking proposition 30,000 registered users on BEST app involving approximately RM30 million in investment Expanded Halal economy financing portfolio by collaborating with HDC, MATRADE, SME Corp & SME Malaysia Opened the 1st environment-friendly branch in the country Fully implemented the BNM Climate Change and Principlesbased Taxonomy (CCPT) GREEN FINANCING PORTFOLIO OF RM2.9 billion (2021: RM2.2 billion) PROFIT BEFORE ZAKAT AND TAX RM746.9 million (2021: RM704.2 million) RETURN ON EQUITY 11.3% (2021: 11.1%) CASATIA RATIO 36.8% (2021: 39.6%) GROSS IMPAIRED FINANCING RATIO 1.27% (2021: 0.96%) TOTAL ASSETS RM89.9 billion (2021: RM80.2 billion) EMPLOYEE ENGAGEMENT READINESS INDEX 88% AMOUNT DISTRIBUTED TO iTEKAD MICROFINANCE PROGRAMME RM4.65 million FUND COLLECTED FOR SADAQA HOUSE RM7.3 million SADAQA HOUSE & AMAL BY BANK ISLAM BENEFICIARIES REACHED 31,608 Overview Bank Islam Malaysia Berhad 5 01 05 03 07 02 06 09 04 08 2022 Key Highlights

BANK ISLAM MALAYSIA BERHAD 1. The BrandLaureate Best Brands Awards 2021-2022 • Nation’s Pride (SME Development) 2. Islamic Retail Banking Awards Cambridge IFA • Islamic Retail Banking Leadership Award 2022 3. PayNet – Compliance Engagement Session 2022 • Best Independent Assessment 2021 – 2nd Place for Retail & Standalone Bank Category • Best Independent Assessment 2019 – 1st Place for Retail Standalone Category 4. Malaysian E-Payments Excellence Awards 2022 by PayNet: • Best Participant Award – Best DirectDebit Bank • Best e-Payments Acceptance Growth Award – Best JomPay Acquirer • Best e-Payments Acceptance Growth Award – Best DirectDebit Acquirer (Bank) 5. Putra Brand Awards 2022 • The People’s Choice (Bronze), (Banking, Investment & Insurance) 6. International Business Review ASEAN Awards 2022 • Corporate Excellence in the Finance and Investments Sector (Green Financing) 7. Sustainability and CSR Malaysia Awards 2022 • Long-Standing Excellence in Sustainability • Bank of The Year (Islamic Banking) for Excellence in Flood and COVID-19 Relief Efforts 8. The Asset Triple A Islamic Finance Awards 2022: • Best SRI Sukuk (Malaysia) – Pengurusan Air Selangor 430 million Ringgit SRI Murabahah Sukuk: Principal Adviser, Lead Arranger, Lead Manager and Shariah Adviser • Best New Sukuk (Malaysia) – Bank Simpanan Nasional 750 Million Ringgit TripleTranche Wakala Sukuk: Lead Manager 9. Asset Benchmark Research Asian Local Currency Bond Benchmark Review 2022 Joseph Ng (Bank Islam), Best Individual in Trading, Malaysian Ringgit bond 10. Commvault Connections 2022 • Customer Innovation Awards – Finalist 11. The Red Hat Awards 2022 • The Red Hat Innovation Awards for Malaysia 12. Syarikat Jaminan Pembiayaan Perniagaan (SJPP) • House & Fixed Assets Financing – Top participating Bank of Skim Rumah Pertamaku (SRP) (House & Fixed Assets Financing) BIMB INVESTMENT 1. The Edge ESG Awards 2022 • BIMB-Arabesque Global ShariahESG AI Tech MYR – Best Fund Based on Asset Class – Equity – Gold • BIMB-Arabesque Global Shariah-ESG AI Tech MYR – Best Overall Winner – Gold BIMB SECURITIES 1. Bursa Malaysia • Retail Investor Campaign 2021 – Top Dealer Category • Highest Number of New Accounts Opened (Shariah) – Farah Fathiah Muzaffar Shah 2. Islamic Market • 2022 Best Overall Bursa Malaysia-i Participating Organisation – 1st Runner Up – 2nd Runner Up • 2022 Best Institutional Bursa Malaysia-i Participating Organisation – 1st Runner Up – 2nd Runner Up • 2022 Best Retail Bursa Malaysia-i Participating Organisation – 1st Runner Up – 2nd Runner Up • 2022 Best Remisier – Muhammad Maherilham Alias (1st Runner Up) – Dzulhilman Sulaiman (2nd Runner Up) Integrated Report 2022 6 Awards & Recognition

Banking on Shared Success: Advancing Prosperity for the Good of All Robust Shariah Governance Framework The Region’s First Full-Fledged Islamic Banking Institution Sizeable Green Financing Portfolio, targeted to double Shariah-ESG assets by 2025 Dedicated Centre of Social Finance – Group Financial Inclusion Values-based Culture, with emphasis on Shariah Goals and VBI Principles Strong balance sheet and performance track record, with AA3/Stable/P1 rating by RAM Ratings World’s 3rd Largest Global Shariah-ESG Equity Fund Malaysia’s Strongest Islamic Retail Bankfor 2020 (accorded by Cambridge IFA) Malaysia’s Largest Network of Dedicated Islamic Banking Channels Overview Bank Islam Malaysia Berhad 7 01 05 03 07 02 06 09 04 08 Our Competitive Advantages

Central Region 45 Branches Northern Region 26 Branches East Malaysia 13 Branches PUTRAJAYA PULAU PINANG PERAK NEGERI SEMBILAN PAHANG SELANGOR PERLIS SARAWAK MELAKA TERENGGANU KUALA LUMPUR KEDAH SABAH JOHOR KELANTAN Southern Region 24 Branches Eastern Region 27 Branches Branches Green Branch • Temerloh, Pahang Contact Centres • Menara Bank Islam • Wangsa Maju Green Contact Centre • Sungai Petani, Kedah Integrated Report 2022 8 Our Presence

The first Islamic Bank established in Malaysia and Southeast Asia WORKFORCE 4,744 TOTAL CUSTOMERS >5.7 million Total of Self-service Terminals (SST) Nationwide 947 Cash Recycler Machines (CRM) 496 Automated Teller Machines (ATM) 451 Scan the QR code for the details of our BRANCH NETWORK or log on to Overview Bank Islam Malaysia Berhad 9 01 05 03 07 02 06 09 04 08

A comprehensive suite of services that include deposit and personal investment products, bank card solutions, financing products, including personal, home and vehicle, and transactional banking services. RETAIL BANKING 1 Competitive financing rates in the market. 2 Convenience for customers through our “Doorstep Banking” service. 3 Substantial public impression of Al-Awfar products that generate good returns through attractive prizes. 4 Award-winning debit card solutions with appealing co-branding initiative. Strengths and Differentiation: A wide range of business financing facilities, catering to commercial vendors and SMEs, which include vendor financing, business premises financing and contract financing service. SME BANKING 1 Customised financing facilities that cater to different client needs. 2 Innovative offers for different customer appetites. 3 Strong rapport with strategic partners for comprehensive financial solutions. 4 Provision of special programmes to nurture SME entrepreneurs. Strengths and Differentiation: COMMERCIAL AND CORPORATE BANKING TREASURY & MARKETS Strengths and Differentiation: 1 Provide customised financing solutions and banking services tailored to the client’s needs, which support the growth of their businesses whilst maintaining nationwide coverage. 2 Innovative offerings for different customer appetites. 3 Strong rapport with strategic partners for comprehensive financial solutions. 4 Provision of special programs to nurture entrepreneurs. 5 Experienced in structured and project financing, especially in the green and renewable energy sector. Strengths and Differentiation: 1 Highly ranked team of qualified professionals with the required competency to deliver the desired financial results. 1 Trade Financing • Letter of Credit-i (LC-i) • Trade Working Capital Financing-i (TWCF-i) • Accepted Bills-i (AB-i) • Shipping Guarantee-i (SG-i) • Bank Guarantee-i (BG-i) • Foreign Currency Exchange (Forex-i) 2 Working Capital • Revolving Credit-i • Business Cash Line-i • Business Financing-i 3 Term Financing • Business Financing-i • AITAB-i 1 Money Market 2 Foreign Exchange (FX) 3 Fixed Income Markets 4 Structured products Integrated Report 2022 10 What We Do Core Businesses

Our Product & Services Personal Financing House Financing ASB Financing Vehicle Financing SME Financing Credit Card Ar Rahnu Takaful Protection Will Writing Deposit Investment Products OUR PRODUCTS Connected Systems (Strategy & Technology) • IT Blueprint • CODE S+ • Data Analytics • Fintech Partnerships • Cloud-Native Digital Banking • Robotic Process Automation (RPA) • Electronic Know Your Customer (eKYC) Connected Processes (People & Channel) • Digital Academy • Bank Islam Shared Values • Digital Bank through Be U • Mobile App • Internet Banking OUR DIGITAL ECOSYSTEM Internet Banking GO by Bank Islam GO Biz by Bank Islam Be U by Bank Islam Sadaqa House SMEXpert eBanker Pro eMasjid Halal Integrated Platform iPortal BEST App BIS Online TruRewards OUR DIGITAL FACILITIES Merchant Portal EZXCESS Virtual Account Opening (VAO) InfaqPay eJamin (Collaboration with Dapat) Wealth Tech (Collaboration with Arabesque) eWallet services (Collaboration with SnapNPay, kiplePay, GHL, MP@y, ME12PAY) CAPITAL MARKETS & CORPORATE ADVISORY BIMB INVESTMENT Strengths and Differentiation: 1 Experienced in facilitating projects as the Lead Arranger and Book Runner Strengths and Differentiation: 1 BIMB Investment offers a comprehensive range of sustainable and responsible investment solutions. 2 Upholding Shariah-ESG Values. 3 Embracing Big Data and Artificial Intelligence to offer a transparent and superior product with a focus on risk management. 1 Origination and execution of Islamic Securities and syndicated financing solutions 2 Corporate advisory Offers Shariah-ESG funds in Malaysia across multiple asset classes including: • Global Equities • Asia Pacific Equities • Malaysia Equities • Global ESG Sukuk • Wakaf unit trust fund BIMB SECURITIES Strengths and Differentiation: 1 Offering of personalised products and services at competitive and attractive rates. 2 Shariah Advisory services within the Capital Markets. 3 The only Islamic securities firm in Malaysia. 1 Shariah Advisory Services 2 Underwriting and Placement 3 Custodian & Nominees Services 4 Share Margin Financing 5 Trading in Securities 6 Investment Advisory-Research & Economic Outlook. Overview Bank Islam Malaysia Berhad 11 01 05 03 07 02 06 09 04 08


MoU Signing Between Bank Islam Malaysia Berhad and Malaysia Institute of Accountant Bank Islam inks a memorandum of understanding (MoU) and strategic collaboration with three professional associations in the country, including the Malaysian Institute of Accountants, to provide a complete suite of Shariahcompliant financial solutions to its members. Al-Awfar Prize-Giving Ceremony Four Al-Awfar account holders each won the grand prize worth RM1 million during the 2021 Al-Awfar Draw, while 10 Special Draw winners each received a luxury car consisting of a MercedesBenz and a Mazda CX-5 model. Launching of Pasar Besar Siti Khadijah’s Digital Transformation Programme Pasar Besar Siti Khadijah’s Digital Transformation Programme has succeeded in achieving 80% of its target, which is to encourage merchants to provide cashless payment services. 8 April Launching of Sadaqa House Orphan Fund As part of our commitment, Bank Islam channelled RM761,000 to three of Sadaqa House’s implementation partners, namely OrphanCare Foundation, Pertubuhan Kebajikan Anak Yatim Malaysia (PEYATIM) and Youth Empowerment Foundation (YEF) in support of the children’s education. The fund aims to collect RM1 billion by 2040. 27 May Launching of Bank Islam VISA FIFA-Themed Credit Card-i Bank Islam, in partnership with Visa, launched the Visa FIFA-themed Credit Card-i to celebrate one of the world’s biggest sporting events in 2022. Developed with football fans in mind, the Bank issued 10,000 Limited-Edition Visa FIFA-themed Credit Card-i to attract new card members. 6 March 17 February 15 June Overview Bank Islam Malaysia Berhad 13 01 05 03 07 02 06 09 04 08 Significant Events 2022

Launch of the Organisational Anti-Corruption Plan 2022-2025 BIMB launched its inaugural Organisational Anti-Corruption Plan (OACP) 2022-2025 to reflect its ongoing commitment to ensuring high conduct, governance and integrity values in all its businesses. MoU Signing Between Bank Islam and Malaysian Public Sector Accountants Association (PSA) Bank Islam and PSA established a strategic partnership to provide complete banking solutions to PSA members across the country covering personal, housing and vehicle financing; credit cards; property management services; deposits and Ar-Rahnu. Bank Islam Visa FIFA-Themed Credit Card-i Campaign Prize-Giving Ceremony Bank Islam announced 192 winners from its Limited-Edition Visa FIFA-Themed Credit Card-i Campaign. The two grand prize winners travelled to Qatar to watch two World Cup quarter-finals matches and enjoyed additional prizes, including return tickets, accommodation and cash prizes worth RM10,000. “Nak Cuti Le Tu...” Campaign Prize-Giving Ceremony Bank Islam handed over two Proton X50 cars to two of the campaign winners. The campaign, organised from 8 January to 7 April, aims to promote a cashless culture among Bank Islam customers using the services provided by GO by Bank Islam mobile banking app and the Bank’s Internet Banking platform. 20 June 3 October 14 July 23 November Integrated Report 2022 14 Significant Events 2022

Global Islamic Finance Forum 2022 The Global Islamic Finance Forum 2022 (GIFF2022) aimed to generate an active discourse on the work required to strengthen Islamic finance’s global leadership position. Critical discussions revolved around FinTech and digitalisation, zooming in on the journey from open banking to embedded finance and how to build digital financial services in easy steps. Panellists also offered a Shariah take on metaverse assets, cryptocurrency, Islamic social finance, Value-based Intermediation (VBI) and the intersection between sustainability and technology. MoU signing between Bank Islam and The Selangor State Development Corporation (PKNS) PKNS and Bank Islam signed an MoU to offer Islamic house financing based on the Tawarruq principle. Kempen Pembiayaan ASB-i Prize-Giving Ceremony Bank Islam gave away 47 prizes worth RM170,000 to its ASB Financing-i 2022 Campaign winners. The campaign aimed to promote Bank Islam’s ASB Financing-i products and helping customers build basic savings while maximising their ASB investment returns. MoU Signing Between Bank Islam and PPZ-MAIWP Bank Islam partners with Pusat Pungutan Zakat, Majlis Agama Islam Wilayah Persekutuan (PPZ-MAIWP) to empower entrepreneurs through the iTEKAD Microfinancing Programme. Under the MoU, micro-entrepreneurs who are PPZ-MAIWP’s business tithe payers can apply for iTEKAD microfinancing, subject to eligibility. 15 August 7 December 4-6 October 23 December Overview Bank Islam Malaysia Berhad 15 01 05 03 07 02 06 09 04 08

From the Desk of the Chairman TAN SRI DR ISMAIL HAJI BAKAR Chairman In 2022, we launched an Organisational Anti-Corruption Plan, which serves as our guiding principle for reinforcing good governance practices across the organisation. Dear Stakeholders, Since becoming Malaysia's first listed fully-fledged Islamic bank in 2021, we have made significant progress and maintained our growth momentum. We recorded solid financial returns while prioritising positive social impacts through financing decisions. Our performance demonstrates how businesses, particularly banks, can serve as a force for good. As the leading Islamic bank in the country, we have always balanced our profits with purpose. We strive to provide inclusive and accessible financial services to all segments of society, regardless of belief, to contribute to shared and sustainable prosperity. Our exceptional growth performance has surpassed major players within the industry, inspiring us to continue our mission. With this in mind, it is with pleasure that I share my assessment of the financial year 2022. REVIEW OF THE YEAR In 2022, the global economy started strong, with GDP growth rebounding to 3.4% after a V-shaped rebound of 6.3% in 2021. However, the RussiaUkraine conflict caused humanitarian issues and profoundly affected the global economy, including spiking prices for gold, crude oil, and natural gas, shuddering stock markets, and emphasising the need for clean energy. Inflation also surged in 2022, with levels not seen since 1996, causing poorer populations worldwide to be squeezed by rising costs for essential goods. Central banks worldwide raised their policy rates to combat inflation, but the pace of rate raises has yet to match inflation levels. Despite these challenges, Malaysia's GDP growth came in at 8.7% highest in ASEAN for 2022, thanks to the government's decision to reopen international borders in April 2022. Private consumption has surged, and the labour market is well on a recovery trajectory with more jobs and business opportunities. Integrated Report 2022 16

Islamic banking has demonstrated stellar performance, outperforming conventional banking with a ten-year compound annual growth rate of 10.9%. Islamic banking’s financing growth surged by 12.4%, powered by the global economy reopening, economic recovery, and higher digitalisation of financial services. While the banking sector experienced low margin compression amid a record low overnight policy rate (OPR) of 1.75% in 2021, Bank Negara Malaysia’s (BNM) decision to increase the rate by 100bps in 2022 to 2.75% is a positive development. Higher interest rates are generally a boost for banks’ margins. However, the increased cost of funds could offset the positive impact due to heightened deposit competition. Amidst the headwinds, Islamic banking has demonstrated stellar performance, outperforming conventional banking with a ten-year compound annual growth rate of 10.9%. Islamic banking’s financing growth surged by 12.4%, powered by the global economy reopening, economic recovery, and higher digitalisation of financial services. STRENGTHENING OUR INTEGRITY & GOVERNANCE Good governance is a fundamental part of our organisational culture and is integral to our business sustainability. Our Board of Directors and leadership team are fully committed to ensuring that we have a robust governance framework that protects all our stakeholders’ best interests. In 2022, we launched an Organisational Anti-Corruption Plan, which serves as our guiding principle for reinforcing good governance practices across the organisation. This plan aims to promote transparency, accountability, and responsibility in all our business dealings. It outlines our commitment to compliance with regulatory requirements, ethical conduct, and risk management. The Integrity Plan sets clear expectations for our employees and reinforces the importance of adhering to our core values of integrity, respect, and professionalism. Through the Integrity Plan, we have imposed measures that ensure a robust risk and compliance culture through persistent and focused efforts towards achieving a sustainable mindset change. We have launched awareness initiatives that aim to instil a risk and compliance culture mindset and provide quick refresher programmes to our first line of defence. We have also implemented a continuous tracking and monitoring mechanism and empowered our people to drive the embedment of the risk and compliance culture. Our network of Business Risk and Compliance Officers is key to this effort, as they retrain our first line of defence and lead them by example, becoming the first point of contact to support our employees in embedding risk and compliance culture. In 2023, we will delve deeper into our employees’ behavioural patterns to better understand the underlying cause and implement an effective behaviour change intervention programme. This will ensure a sustainable mindset change effort and solidify our commitment to a culture of integrity and compliance. INTEGRATING SUSTAINABILITY INTO BIMB Integrating environmental, social, and governance (ESG) principles in the Islamic banking sector is not new. Islamic banking has always been centred on ethical finance and sustainability principles, focusing on social responsibility and community development. As the world shifts towards a more sustainable future, BIMB has taken a leading role in promoting ESG principles within the industry. BIMB’s commitment to ESG is reflected in its strong performance and outpacing its competitors in sustainable finance. Over the past year, we have made remarkable progress in integrating sustainability into our operations, with the strong execution of BIMB’s Sustainability Plan. We have launched five sustainability commitments, endorsed governance oversight on sustainability, and established a dedicated Sustainability Project Working Team (SPWT). Leadership Insights Bank Islam Malaysia Berhad 17 01 05 03 07 02 06 09 04 08

At BIMB, we have proactively promoted our ESG capabilities, spearheading a Value-based Intermediation Financing and Investment Impact Assessment Framework (VBIAF) Sectoral guide on waste management, which places us ahead of other industry peers. Our efforts have not gone unnoticed. In 2022, we were honoured with four prestigious awards at The Asset Triple A Award ceremony, including The Best SRI Sukuk as Principal Adviser, Lead Arranger, Lead Manager, and Shariah Adviser. Our subsidiary, BIMB Investment Management Berhad (BIMB Investment), was named ESG Asset Manager of the Year for the third time. At the Sustainability & CSR Malaysia Awards 2022, organised by CSR Malaysia, BIMB was recognised for Long-Standing Excellence in Sustainability and Bank of the Year (Islamic Banking) for Excellence in Flood and COVID-19 Relief Efforts. These accolades are a testament to our unwavering commitment to sustainability and social responsibility. CREATING TRUST AMONGST OUR STAKEHOLDERS BIMB’s practice of stakeholder economy is centred on creating value for all stakeholders. As a responsible and credible bank, we are committed to serving the needs of our customers, employees, communities, and shareholders. We recognise that employees are key to our success and growth. To future-proof the workforce, the Bank has implemented several measures to ensure that employees have the necessary skills and knowledge to co-evolve with the bank. This year, we launched BIMB’s Digital Academy, a one-stop centre for our employees to access learning programmes grounded in practical application to real-world business challenges. Our learning pathways guide their upskilling journey, and we also provide them with references to subject matter experts in digital capabilities and updates on the latest digital skill courses. Additionally, we remain steadfast in empowering communities, as reflected in LEAP25’s strategic theme of “Enriching Communities”. Our social initiatives to provide financial access and support to underserved communities through the Sadaqa House charity fund is a testament to our commitment to financial inclusion. We have set a target to channel RM1 billion in funds into Sadaqa House Orphan Fund by 2040, enabling us to support orphans from cradle to graduation. Since 2018, Sadaqa House had raised RM17.4 million in funds, benefitting 16,009 beneficiaries. While we focus on creating value for all stakeholders, we also maintain our commitment to delivering sustainable and strong returns to our shareholders. We are pleased to report that our shareholders have shown their trust and support by reinvesting their dividends into the bank through our Dividend Reinvestment Plan (DRP), with an almost 90% participation rate. This demonstrates their confidence in our business and our ability to deliver long-term value. OUTLOOK & ACKNOWLEDGEMENTS Despite the challenges from 2022 spilling over into the upcoming financial year, BIMB is confident in the country’s diverse economic structure and sound fundamentals to cushion growth headwinds in 2023. While a slowdown is inevitable, timely policy interventions can mitigate its impact. However, a moderation in global economic growth coupled with a higher interest rate environment may slow growth momentum and weigh on Islamic Banks’ asset quality in 2023. Nonetheless, BIMB has ensured adequate impairment provisioning levels to manage asset-quality deterioration. Given the improving labour market and still-expanding economy, the growth rate is expected to outpace Conventional Banking performance, with GDP projected to grow by 4.5% during the year. The Board will continue to guide the Group to remain on track with our transformation strategy. BIMB will remain flexible and agile in a dynamic market. The focus will be on building digital capabilities to become a customer-centric digital bank that offers seamless and innovative products and services. We will also use our financial strength to influence positive environmental and social outcomes towards a sustainable future. In closing, I would like to express my gratitude to all our stakeholders for their unwavering support. I would like to extend a special thank you to Encik Ridza, our longest-serving board member, for his invaluable contributions to the Bank over the years. We are also grateful to Dato’ Sri Khazali for his guidance during the chairmanship of the Board Nomination and Remuneration Committee (BNRC). I would also like to welcome the latest addition to our Board of Directors, the esteemed Dato’ Prof Dr Noor Inayah Yaakub. As our newest Independent Non-Executive Director, she brings a wealth of knowledge and experience to the table. With her appointment, we have made significant progress towards our goal of greater gender diversity, with women now making up 30% of the Board. TAN SRI DR ISMAIL HAJI BAKAR Chairman Integrated Report 2022 18 From the Desk of the Chairman

Group Chief Executive Officer Statement MOHD MUAZZAM MOHAMED Group Chief Executive Officer Dear Stakeholders, I am pleased to report BIMB’s outstanding performance in 2022, despite the significant headwinds that continue to challenge our ability to serve our stakeholders. Our resilience during these unprecedented times is a testament to our unwavering commitment to helping our customers while achieving our financial goals. Our adherence to Value-based Intermediation (VBI) has been instrumental in our resilience and continued growth. Sustainability has been a fundamental part of our DNA long before it became mainstream in the business environment. This approach has allowed us to navigate social and environmental risks, such as pandemics and climate change, to deliver shared growth and prosperity for our customers and society at large. THE BANKING LANDSCAPE: OUR STANDING IN THE MARKET In 2022, Malaysia’s banking industry demonstrated strength despite global events and market uncertainties. The net financing growth in the industry has increased by 4.9% year-on-year (YoY), with household, personal, and term financing being the primary drivers of the growth. However, loan indicators such as loan applications and approvals have contracted month-on-month (MoM) in the past two to three months, indicating signs of weakening in the leading loan indicators. On the other hand, BIMB has outpaced the banking industry’s loan expansion, with financing growth mainly contributed by household, personal, and term financing. The growth in outstanding credit card receivables and Ar-Rahnu also climbed 21.5% compared to December 2021. However, the Gross Impaired Financing (GIF) ratio was higher at 1.27% as of December 2022, mainly due to higher impairment incurred in households and business financing. BIMB has implemented adequate measures to manage the GIF ratio and assure stakeholders. The industry faces challenges posed by vulnerable household and SME borrowers who could not resume loan repayments after exiting the repayment assistance programme and defaults of specific corporate borrowers. Malaysian banks are strong in terms of their liquidity coverage ratio, whereby should the situation affect the liquidity in the market, banks are resilient enough to face the situation. Leadership Insights Bank Islam Malaysia Berhad 19 01 05 03 07 02 06 09 04 08

The banking system recorded healthy liquidity positions, with the aggregate Liquidity Coverage Ratio (LCR) at 154.1% in December 2022 due to sustained deposit growth supporting banks’ lending activities. BIMB’s LCR was above the industry average at 170.4%, which depicted sufficient liquidity and acted as a financial cushion in uncertain economic conditions. BIMB’s capital buffers remained strong, with a total capital ratio of the Group at 19.4% as of the end of December 2022, higher than the industry average, providing the Bank with a better capacity to handle unforeseen losses or financial downturns. BIMB experienced a deterioration in non-fund-based income (NFBI), primarily from higher marked-to-market losses on investment due to surging bond yields and higher forex revaluation losses caused by shifting market conditions. Nonetheless, the Bank’s stronger fees and commission income growth helped to offset the drag in NFBI. Overall, the domestic financial system is well-positioned to support economic recovery. BIMB remains focused on minimising adverse consequences during this period of uncertainty while proactively seeking growth opportunities. BIMB’s capital buffers remained strong, with a total capital ratio of the Group at 19.4% as of the end of December 2022, higher than the industry average, providing the Bank with better capacity to handle unforeseen losses or financial downturns. Green Financing portfolio grew to RM2.9 billion (2021: RM2.2 billion) OUR SEGMENTAL PERFORMANCE: KEY HIGHLIGHTS AND ACHIEVEMENTS BIMB's strong performance during the reporting year is reflected in the progress achieved across our various business segments, showcasing the effectiveness of our strategy and customer-centric approach. The Consumer Banking division saw significant growth in 2022, with a 9.3% increase attributed to the post-pandemic economic recovery and improved employment rates. This division is committed to helping lower-income customers achieve their dream of homeownership, and the innovative Home Financing-i with Bullet Payment plan has made it easier for customers to acquire residential properties with enhanced payment options, lower commitments, and broader financial eligibility. As part of our commitment to sustainability, Consumer Banking also introduced House Financing for Solar Panels and Hybrid & Electrical Vehicle (HEV) Financing, with RM17 million disbursed for 127 HEVs in 2022. With an increased penetration in the Non-National Vehicle portfolio of RM143.6 million, Consumer Banking remains dedicated to providing innovative and sustainable solutions for its customers. See page 70 for more information. Corporate and Commercial Banking segments focused on providing excellent customer service and tailored solutions to meet the unique needs of their clients. Despite the challenges posed by the pandemic, Corporate and Commercial Banking have actively captured and retained quality corporate customers by providing bespoke financing solutions and banking services tailored to their unique needs. Guided by the “Think Customer” Value, the segments responded quickly to accommodate customers’ requests for financing moratoriums and financial assistance to alleviate the pandemic’s impact. The segments have also utilised innovative non-fund-based instruments such as BG-i to structure facilities, improved its offering, and championed the Bank Guarantee issuance for faster turnaround times. By focusing on strategic sectors with increasing demand, Corporate Banking recorded a 36.1% asset growth to RM9.6 billion and a total gross income of RM298.5 million, with RM287.9 million from Fund-Based and RM10.6 million from Non-Fund-Based. In comparison, Commercial Banking saw a decrease in total assets by RM190.5 million (2.7%) to RM6.95 billion compared to 2021. However, there was an Integrated Report 2022 20 Group Chief Executive Officer Statement

increase in total gross income by RM25.3 million (8.3%) to RM329.1 million, mainly driven by a higher fund-based income of RM308.1 million. See pages 84 & 89 for more information. SME Banking strengthened its position as a leading financial solution provider for SMEs by introducing new financing programs such as SME Exporter and SME Smart Eco, increasing our client base and leveraging BNM funding initiatives to promote business recovery, growth, and sustainability. We also engaged in strategic collaborations with partners to expand our market outreach and meet their members' financial needs. In March 2022, we partnered with MIDA to support grant recipients in purchasing machinery and equipment upfront, while in April 2022, we signed an MoU with iPORTAL Live Sdn Bhd to bring our Islamic financial solutions onto a global platform, enabling digital connectivity for all sectors in the Halal Economy. Although the Non-SME segment’s asset contribution decreased to RM5.13 billion, BIMB remains optimistic about its growth potential. Despite an increase in Commercial’s GIF ratio to 2.70%, the Bank’s risk management measures remain proactive, and the Past Due but Not Impaired (PDNI) ratio decreased to 0.14% in December 2022. See page 80 for more information. The Deposits and Cash Management segment delivered strong results, with a significant YoY increase of 18.4% in deposits and investments, totalling RM7.4 billion. The positive growth was largely attributed to the opening of all economic sectors in Q4 2021, which benefited the non-individual segment. Our customer-centric approach in 2022 led us to develop the Virtual Account Opening (VAO) process, in collaboration with eChannels, which facilitated a faster onboarding process for newly opened accounts. Additionally, we registered over 400 FPX merchants, gained 1,076 subscribers via MyPTPTN app, and acquired 14,256 GOBiz subscribers, while achieving 22,096 eBanker Pro subscribers. We also won three awards at the Malaysian ePayments Excellence Awards (MEEA) in April 2022, recognising our commitment to SMEs: Best JomPay Acquirer, Best Direct Debit Bank, and Best Direct Debit Acquirer (Bank). See page 75 for more information. BIMB Investment offers a wide range of Shariah-ESG funds across multiple asset classes and embraces innovation to provide an investment return to its investors. It leverages Arabesque Asset Management’s artificial intelligence (AI) investment tool to identify investable stocks that comply with our Shariah requirements and sustainable investment policy. BIMB Investment has made the Group proud by winning multiple awards and accolades throughout 2022. Amongst others, the fund management arm of BIMB was recognised in the Shariah-ESG space by winning The Edge ESG Awards in two categories, the Alpha Southeast Asia Awards and the Global Business Awards in 2022. Its assets under management (AuM) overall funds of RM1.01 billion and Shariah-ESG Fund of RM745.1 million is a testament to its 28-year commitment to Islamic Fund Management and its focus on Shariah-ESG investing since 2015. The company will continue to intensify its digital business by further enhancing and marketing its BEST app digitally, aiming to offer superior risk-adjusted investment solutions. BIMB Investment’s digital initiatives are aligned with the Group’s digital banking proposition and LEAP25 business strategy. See page 98 for more information. BIMB Securities experienced a 56% decline in revenue generation for the Retail segment due to a decrease in market volume from RM1.399 billion in 2021 to RM0.686 billion in 2022. However, the decline was partially offset by a 4% increase in share margin financing income. To increase market visibility, BIMB Securities expanded stock coverage from 36 stocks in 2021 to 66 in 2022, conducted events and company visits for institutional clients, and hosted weekly webinars and knowledge-sharing sessions for retail clients. The company also introduced the Financial Risk Advisory (FRA) System and digital signatures for the Online Trading Application Form (OTAF). See page 104 for more information. Treasury & Markets recorded growth in FX sales volume and total deposits despite intense competition and margin erosion. While wholesale funding costs contributed to margin compressions, liquidity metrics improved. Fixed income investments and trading activities were conservative, with a passive stance in the first half and cautious reinvestment throughout the year. Sukuk distribution performed well, with the Bank appointed as Lead Manager/Joint Lead Manager for 12 ESG-rated Sukuk distribution deals. The fixed-income team achieved a Top 5 ranking in Bloomberg's Malaysian Ringgit Islamic Sukuk League Table for 2022 and received accolades for Best SRI Sukuk and Best New Sukuk. See page 95 for more information. Leadership Insights Bank Islam Malaysia Berhad 21 01 05 03 07 02 06 09 04 08

BIMB’s commitment to sustainability extends to two key areas: the sustainability of our business and the sustainability of the environment and society. We remain focused on delivering long-term financial value as we progress towards a prosperous and sustainable future. In 2022, we surpassed expectations with a 6.1% increase in Profit Before Zakat and Tax (PBZT) year-over-year. Our star products, Personal Financing and Home Financing, experienced impressive growth of 9.6%. We are proud to report that our SME portfolio outperformed our target by a remarkable 70.7%, thanks to the tireless efforts of our dedicated sales force and their approach towards targeted sectors. Our sustained ROE of 11.3%, Return on Assets (ROA) of 0.9%, and asset growth and net financing growth of 12.1% and 11.6%, respectively, demonstrate our continued dedication to excellence. Additionally, we achieved a Current, Saving and Transactional Investment Account (CASATIA) ratio of 36.8% and a NIM of 2.31%. Despite a 35.5% decline (at Group level) in NFBI due to losses in Unit Trust, Forex, and investment, we are delighted to see higher income from eChannels and Bancatakaful in our Consumer Banking sector, resulting in higher NFBI by 22.8% year over year. Our GIF ratio remains well below industry standards at 1.27%, and our LCR is well above the regulatory requirement of >100% at 170.4%. While our CIR increased to 59.8%, we are actively making progress on cost management. Sustainable Prosperity: Continuous Sound Financial Performance 1 PROPELLING OUR STRATEGIC TRANSFORMATION BIMB has been actively working towards its LEAP25 targets, which are focused on being the bank that advances prosperity for all and provides solutions that deliver value. This five-year roadmap aims to deliver the promise of technology and redefine growth while addressing unprecedented challenges. By 2025, the Group aspires to be a champion in offering ShariahEnvironmental, Social, and Governance (ESG) total financial solutions with leadership in digital banking and social finance. Two years into LEAP25, we have made significant progress and are on track to achieving our 2025 targets, including more than doubling ESG-rated financing assets with a green financing portfolio of RM2.9 billion, creating impact for over 10,545 beneficiaries through social finance, and improving employee engagement and change readiness index to 88%. While sustaining an ROE was 11.3%, LEAP25 aims to increase NFBI contribution and reduce CIR to below 50% by 2025. Our progress and achievements in LEAP25 are based on the strides made in our six key strategic pillars, as elaborated below. In addition to strong financial results, we made significant headway in our sustainability journey. Within our operations, we continued to improve our environmental footprint through the GoGreen-Energy Efficiency initiative. Under this initiative, we established the country’s first environment-friendly branch in Malaysia, located in Temerloh, Pahang. The green branch uses solar energy as a clean, renewable energy source, installing solar panels on the roof. In addition, it also uses a rainwater harvesting system to collect and reuse natural resources to promote the efficient use of water. As a financial institution, our most significant impact and influence lie in where we channel our money. We are proud to have committed to doubling our green financing growth by 2025. As of 2022, we have approved RM2.9 billion in green financing and are on track to achieve our target. Additionally, we recognise the urgent need to protect our business, customers, and society from social and environmental issues. To this end, we have embedded ESG risk in our risk management framework, marking a significant milestone in our efforts. This year, we have fully implemented the BNM Climate Change and Principles-based Taxonomy (CCPT), assessed the ESG risk and performance of our business financing customers and piloted the inclusion of ESG action plans and criteria in selected financing applications that involve high-risk sectors. Integrated Report 2022 22 Group Chief Executive Officer Statement