287 NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2025 06 / FINANCIAL STATEMENTS 01 02 03 04 05 07 08 09 48. CAPITAL MANAGEMENT AND CAPITAL ADEQUACY Capital management The Group and the Bank maintain an actively managed capital base to cover risks inherent in the business. The adequacy of the Group's and the Bank's capital is monitored using, among other measures, the rules and ratios established by the Basel Committee on Banking Supervision and adopted by BNM in supervising the Bank. The primary objectives of the Group's and the Bank's capital management are to ensure that the Group and the Bank comply with regulatory capital requirements maintain strong credit ratings and healthy capital ratios in order to support their businesses and to maximise shareholders' value. The Group and the Bank manage their capital structure and make adjustments to it in light of changes in economic conditions and the risk characteristics of their activities. In order to maintain or adjust the capital structure, the Group and the Bank may adjust the amount of dividend payments to their shareholders, return capital to their shareholders or issue capital securities. Nevertheless, this is under constant scrutiny of the Board. Capital adequacy The capital adequacy ratios of the Group and of the Bank are computed in accordance with BNM's revised Risk-Weighted Capital Adequacy Framework. The Bank has adopted the Standardised Approach for Credit Risk and Market Risk, and the Basic Indicator Approach for Operational Risk (Basel II). The minimum regulatory capital adequacy requirements for Common Equity Tier 1 ("CET 1"), Tier 1 and Total Capital are 4.5%, 6.0% and 8.0% of total risk weighted assets. Components of Tier 1 and Tier 2 capital: The capital adequacy ratios of the Group and of the Bank are as follows: Group Bank 2025 2024 2025 2024 Before deducting interim dividends * CET 1 capital ratio 17.338% 16.671% 18.639% 17.264% Tier 1 capital ratio 18.575% 16.671% 20.212% 17.264% Total capital ratio 21.797% 22.967% 24.328% 24.736%
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