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Concepts of finance_analysis

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Kuwait Finance House
CIMB
Group
Bank
Group
Bank
Ijarah/Leasing
105,228
140,194
73,811
-
AITAB/ Hire
Purchase
1,696,868
1,908,174
12,772,502
4,918,434
Total net loans,
advances and
financing
5,288,745
5,197,764
155,691,566
108,086,083
% of contribution
) The Bank obtained a funding through the securitisation of its hire purchase receivables to a third
party.
On 4 November 2011, the funding 1st tranche of RM180 million is raised for an effective interest
rate of 2.85% per annum, payable on monthly basis with coupon payment due on every 28 of the
month, and will mature on 28 October 2016.
On 16 December 2011, the funding 2nd tranche of RM320 million is raised for an effective interest
rate of 3.00% per annum, payable on monthly basis with coupon payment due on every 28 of the
month, and will mature on 28 October 2016.
The Group and the Bank continues to recognise the hire purchase receivables on its statements of
financial position as at 31 December 2012 and 2011 as the Group and the Bank continues to retain the
risk and rewards of the hire purchase receivables.
^ The following has been applied in computing the capital adequacy ratio:
- financing of hire purchase under PCSB (excluding those securitised) is included in the computation of RWA(risk weighted
assest) under
the AIRB (advance internal rating base) approach;
- the investment in owner's note is accounted in accordance with Securitisation Framework under Risk Weighted
Capital Adequacy Framework (Basel II - Risk Weighted Assets Computation) Guideline dated 31 December 2009.

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CIMB
Assets purchased under lease
(a) Finance lease
Assets purchased under lease which in substance transfers the risks and benefits of ownership
of the assets to the Group or the Bank are capitalised under property, plant and equipment. The
assets and the corresponding lease obligations are recorded at the lower of the present value of
the minimum lease payments or the fair value of the leased assets at the beginning of the lease
term. Such leased assets are subject to depreciation on the same basis as other property, plant
and equipment.
Leases which do not meet such criteria are classified as operating lease and the related rentals
are charged to statement of income.
(b) Operating lease
Leasehold land
Leasehold land that normally has an indefinite economic life and title is not expected to pass
to the lessee by the end of the lease term is treated as an operating lease. The payment made
on entering into or acquiring a leasehold land is accounted as prepaid lease payments that are
amortised over the lease term in accordance with the pattern of benefits provided.
Others
Leases of assets under which all the risks and benefits of ownership are retained by the lessor
are classified as operating leases. Payments made under operating leases are charged to the
statement of income on a straight line basis over the period of the lease. When an operating
lease is terminated before the lease period has expired, any payment required to be made to the
lessor by way of penalty is recognised as an expense in the period in which termination takes
place.
Assets sold under lease
(a) Finance lease
When assets are sold under a finance lease, the present value of the lease payments is
recognised as a debtor. The difference between the gross debtor and the present value of the
debtor is recognised as unearned finance income. Lease income is recognised over the term of
the lease using the net investment method, which reflects a constant periodic rate of return.
(b) Operating lease
Assets leased out under operating leases are included in property, plant and equipment in the
statements of financial position. They are depreciated over their expected useful lives on a basis
consistent with similar property, plant and equipment. Rental income is recognised on a
straight line basis over the lease term.

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 Kuwait Finance House CIMB Group Bank Group Bank Ijarah/Leasing 105,228 140,194 73,811 - AITAB/ Hire Purchase 1,696,868 1,908,174 12,772,502 4,918,434 Total net loans, advances and financing 5,288,745 5,197,764 155,691,566 108,086,083 % of contribution ) The Bank obtained a funding through the securitisation of its hire purchase receivables to a third party. On 4 November 2011, the funding – 1st tranche of RM180 million is raised for an effective interest rate of 2.85% per annum, payable on monthly basis with coupon payment due on every 28 of the month, and will mature on 28 October 2016. On 16 December 2011, the funding – 2nd tranche of RM320 million is raised for an effective interest rate of 3.00% per annum, payable on monthly basis with coupon payment due on every 28 of the month, and will mature on 28 October 2016. The Group and the Bank continues to recognis ...
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