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RHB ISLAMIC BOND FUND INTERIM REPORT 2016 Incorporating
RHB ISLAMIC BOND FUND
(formerly known as RHB-OSK Islamic Bond Fund)
INTERIM REPORT 2016
Incorporating The Unaudited
Financial Statements
For the six month financial period ended 31 March 2016
RHB Asset Management Sdn Bhd (174588-X)
Head Office
19th Floor, Plaza OSK, Jalan Ampang
50450 Kuala Lumpur, Malaysia
Tel : +603-2164 3036
Fax : +603-2164 4226
www.rhbgroup.com
GENERAL INFORMATION ABOUT THE FUND
Commencement Date
RHB Islamic Bond Fund (formerly known as RHB-OSK Islamic Bond Fund)
(“Fund”) commenced operations on 25 August 2000.
Fund Category and Type
Fund Category
-
Bond (Shariah-compliant)
Fund Type
-
Income fund
Investment Objective, Policy and Strategy
Objective of the Fund
To provide regular income to investors through investments in Islamic fixedincome securities and Islamic bonds/ sukuk which are acceptable investment under
the principles of Shariah.
Strategy
Investments in sukuk must carry a minimum long term credit rating of BBB and
above or a minimum short term rating of P3 as assigned by Rating Agency of
Malaysia Berhad (“RAM”) or its equivalent. To contain credit risk, the Manager
will ensure that the diversification of credit rating (and duration standing) in the
bond/sukuk portfolio mitigate the overall risk position of the portfolio.
The asset allocation of the Fund will be as follows:Up to 95% of
Net Asset Value
- Investments in sukuk and Islamic fixed income
instruments
Minimum of 5% of - Investments in liquid assets acceptable under Shariah
Net Asset Value
principle
1
1
Investment Philosophy
Our investment philosophy describes the approach that the investment team will
adhere to when constructing an equity or fixed income portfolio. The portfolio
managers invest in well-managed companies with strong balance sheets that
possess competitive advantages that should enable them to outperform their peers
over economic cycles. The portfolio managers are active investors that make high
conviction security selection decisions, but at the same time do not take
unnecessary or excessive risks nor take speculative positions. The portfolio
managers seek to outperform their peers and beat their benchmark by buying
mispriced or cheap securities. Following our disciplined sell strategy, they would
then exit positions when our target price is reached. Concurrently, the portfolio
managers understand the Fund‟s risk profile and act within the Fund‟s mandate.
2
2
Investment Approach
Whenever the Fund invests in sukuk, the Manager‟s investment approach will
evolve around the following principles:-
Performance Benchmark
Maybank Islamic Berhad‟s 12 Months General Investment Account Rate. With
effect from 1 January 2016, the Fund has changed its performance benchmark to
Maybank Islamic Berhad‟s 12 months Islamic Fixed Deposit-I (“IFD-i”).
Investment Policies and Restrictions
Investments in sukuk and Islamic fixed-income instruments must carry a minimum
long term credit rating of BBB and above or a minimum short term rating of P3 as
assigned by RAM or its equivalent. The Manager may also take temporary
defensive measures that may be inconsistent with the Fund‟s principal strategy in
attempting to respond to adverse market conditions, economics, political or any
other conditions which the Manager deem detrimental to the Fund. The defensive
measures that the Manager may undertake are in no way to be deviated from the
mandates or breaching any laws and regulations. During the temporary defensive
period, the Manager may choose to increase the asset allocation by allocating more
investment into risk free investments which are money market instruments and
deposit in adverse market condition.
Fund Distribution Policy
Income (if any) will be distributed during the financial year.
3
3
MANAGER‟S REPORT
MARKET REVIEW
US Treasuries (“UST”) bearish steepened in 4Q15 on expectation of potential
Federal Fund Rate (“FFR”) hike which eventual materialized in December 2015,
that Federal Reserve (“Fed”) finally delivered a 25 basis points (“bps”) hike on the
FFR. Moving into 1Q16, UST subsequently turned stronger, particularly after
International Monetary Fund (“IMF”) downgraded global growth in 2015 and
potential growth rate for 2016. At close, the 2-, 5-, 10- and 30-year UST were
trading at 0.72% (September 2015: 0.63%), 1.21% (1.36%), 1.77% (2.04%) and
2.61% (2.85%) respectively.
With Fed Fund rate hike pan out as expectation and also a benign 2016 government
bond auction calendar, the Malaysian Government Securities (“MGS”) market
received better support from both local and foreign investors, with the yield curve
bullish steepened in 4Q15. Long end curve of the MGS rallied in the subsequent
quarter post BNM delivering 50bps of Statutory Reserve Rate (“SRR”) cut in the
Monetary Policy Meeting (“MPC”) in January 2016 coupled with strong Ringgit
performance. At as 31 March 2016, the 3-, 5-, 7-, 10-, 15-, 20- and 30-year MGS
were traded at 3.22% (September 2015: 3.72%), 3.40% (3.81%), 3.69% (4.11%),
3.78% (4.15%), 4.16% (4.55%), 4.35% (4.63%) and 4.67% (4.75%) respectively.
Performance on the Government Investment Issues (“GII”) was also similar to that
of MGS with front end yield curve getting better support from investors. The 3-, 5-,
7-, 10-, 15-, 20-year GII were traded at 3.20% (September 2015: 3.80%), 3.66%
(4.04%), 3.90% (4.33%), 4.03% (4.35%), 4.43% (4.68%) and 4.59% (4.78%).
Strong govvies interest also spilled over to the credit market with average daily
trading volume still sustain at around RM639mil (4Q15: RM347mil) in 1Q16. With
the compression of MGS/GII yield curve in 1Q16, trades on GG/AAA continued to
top the total volume share with 61.1% recorded, followed by 35.9% in AA. The
rest was single-A trades.
In the local economic space, trade surplus narrowed in January 2016 as exports
unexpectedly fell by 2.8% Year-on-Year (“YoY”) (December 2015: 4.9%,
consensus: 2.5%) while imports rose 3.3% (December 2015: 3.2%, consensus:
4.9%). The sequential fall in exports and imports are mainly led by Electrics and
Electronics, Oil & Gas, and intermediate goods. Current Account may narrow
further in 2016 as Liquid Natural Gas (“LNG”) prices should continue falling in
1H2016 as a lagged response to the fall in crude oil prices, while soft global
demand conditions may moderate gains in manufactured exports. During the 2nd
MPC meeting, Bank Negara Malaysia (“BNM”) kept Overnight Policy Rate
(“OPR”) unchanged at 3.25% with growth outlook broadly unchanged. Inflation
4
4
5
emphasis on negative rates as the main stimulus tool. We do expect that the ECB
and BoJ will cut rates further, but do not expect them to rush; while the ECB easing
is likely to be spread across a range of tools, instead on focusing solely on negative
rates.
At the same time, there are signs that low-inflation risks are receding in the US and
United Kingdom (“UK”). For example, the US core Consumer Price Index (“CPI”)
measure (excluding food, drink, tobacco and energy) is up 2.3% YoY, the highest
since early 2012 with the 6-month annualized rate at 2% since mid-2015. Likewise,
in the UK, headline CPI inflation has crept up to 0.3% YoY in February 2016 from
negative levels in late-2015. Against this backdrop, we think that Fed‟s two hikes
in this year versus four previously is more realistic now and our forecast for the
next hike is perhaps in June 2015, although external conditions could stay the Fed‟s
hand. Lastly, the UK‟s upcoming European Union (“EU”) referendum (23rd June
2016) remains a key uncertainty for coming month. Brexit, if happens, would be a
major negative in economic and political terms for the UK and EU as a whole and
we might see ECB to take on the outright negative policy rates measures to calm
market. Safe heaven flow into the USD following potential Brexit (not just out of
GBP, but also out of EUR if Brexit creates fears of wider unraveling of the EU)
may also affect the US outlook.
Back home in Malaysia, monetary policy is likely to remain status quo for now
after the 50bps of SRR cut in January. With GDP growth target being revised lower
from 4.5 - 5.5% to 4.5 - 5.0% in 2016, there might be a likelihood of OPR cut
should the actual growth numbers underperforming the forecasted target. However
this is still not our base case scenario and we would need to have more incoming
data to support our argument. With Goods and Services Tax (“GST”) base effect
waning come April 2015, Malaysia‟s long term inflation trend is likely to remain at
2% - 3% which sits well with our OPR of 3.25% currently. The bond market has
certainly factored in the probability of rate cut by BNM given how flat the yield
curve is compared to beginning of the year. While we are still advocating on
overweight duration, we prefer to take credit risk than absolute interest rate risk
betting the yield curve to flatten further.
For the financial year under review, the strategy adopted by the Fund is in line with
the disclosure in the prospectus. The Fund employed an active management style
and invested in debt securities to provide investors with above-average returns. As
at 31 March 2016, the portfolio duration was approximately 5.71 years, denoting
the weighted average tenure of bonds in the portfolio. Separately, the assets of the
fund were diversified across issues and sectors to mitigate credit risk.
6
6
PERFORMANCE
PERFORMANCE
REVIEW
PERFORMANCE REVIEW
REVIEW
For
For
the
financial
period
under
review,
the
Fund
registered
total
return
of
5.03%*
For the
the financial
financial period
period under
under review,
review, the
the Fund
Fund registered
registered aaa total
total return
return of
of 5.03%*
5.03%*
compared
to
the
benchmark
return
of
1.85%*.
The
Fund‟s
outperformance
compared
to
the
benchmark
return
of
1.85%*.
The
Fund‟s
outperformance
was
compared to the benchmark return of 1.85%*. The Fund‟s outperformance was
was
attributed
attributed to
to the
the Fund
Fund
Manager‟s
active
management
in
strategizing
the
portfolio
attributed
to
the
Fund Manager‟s
Manager‟s active
active management
management in
in strategizing
strategizing the
the portfolio
portfolio
duration
duration
and
tactical
asset
allocation
which
was
well
invested
during
the
year
under
duration and
and tactical
tactical asset
asset allocation
allocation which
which was
was well
well invested
invested during
during the
the year
year under
under
review.
During
the
financial
period
under
review,
the
Fund
has
achieved
review.
its
review. During
During the
the financial
financial period
period under
under review,
review, the
the Fund
Fund has
has achieved
achieved its
its
investment
investment
objective.
investment objective.
objective.
*** Source:
Source:
Lipper
IM
Source: Lipper
Lipper IM
IM
PERFORMANCE
PERFORMANCE
DATA
PERFORMANCE DATA
DATA
RHB
RHB
Islamic
Bond
Fund
RHB Islamic
Islamic Bond
Bond Fund
Fund
1-month
1-month
1-month
%
%
%
Total
Total
Return
Total Return
Return
3-month
3-month
6-month
3-month 6-month
6-month
%
%
%
%
%
%
(formerly
known as
RHB-OSK Islamic
Bond
(formerly
(formerly known
known as
as RHB-OSK
RHB-OSK Islamic
Islamic Bond
Bond
Fund)
Fund)
Fund)
0.76
0.76
0.76
2.55
2.55
2.55
5.03
5.03
5.03
Islamic
Islamic
Bond
Index**
Islamic Bond
Bond Index**
Index**
0.29
0.29
0.29
0.85
0.85
0.85
1.85
1.85
1.85
RHB
RHB
Islamic
Bond
Fund
RHB Islamic
Islamic Bond
Bond Fund
Fund
Average
Annual Return
Average
Average Annual
Annual Return
Return
11 Year
33 Years
55 Years
Year
1 Year
3 Years
Years
5 Years
Years
(31.03.2015(31.03.2013(31.03.2011(31.03.2015(31.03.2013(31.03.2011(31.03.2015- (31.03.2013- (31.03.201131.03.2016)
31.03.2016) 31.03.2016)
31.03.2016)
31.03.2016) 31.03.2016)
31.03.2016) 31.03.2016)
31.03.2016)
%
%
%
%
%
%
%
%
%
(formerly
known as
RHB-OSK Islamic
Bond
(formerly
(formerly known
known as
as RHB-OSK
RHB-OSK Islamic
Islamic Bond
Bond
Fund)
Fund)
Fund)
7.49
7.49
7.49
5.78
5.78
5.78
7.76
7.76
7.76
Islamic
Islamic
Bond
Index**
Islamic Bond
Bond Index**
Index**
3.62
3.62
3.62
3.36
3.36
3.36
3.28
3.28
3.28
RHB
RHB
Islamic
Bond
Fund
RHB Islamic
Islamic Bond
Bond Fund
Fund
Annual
Annual
Total
Return
Annual Total
Total Return
Return
for
the
financial
for
year
ended
for the
the financial
financial year
year ended
ended
30
30
September
30 September
September
2015
2015
2014
2013
2012
2011
2015 2014
2014 2013
2013 2012
2012 2011
2011
%
%
%
%
%
%
%
%
%
% %
%
% %
%
(formerly
known as
RHB-OSK Islamic
Bond
(formerly
(formerly known
known as
as RHB-OSK
RHB-OSK Islamic
Islamic Bond
Bond
Fund)
Fund)
Fund)
--- Capital
(0.73)
Capital
Return
(0.73)
(2.15)
13.56
(5.24)
4.67
Capital Return
Return
(0.73) (2.15)
(2.15) 13.56
13.56 (5.24)
(5.24) 4.67
4.67
--- Income
Return
6.86
6.74
6.80
4.84
Income
Return
6.86
6.74
6.80
4.84
3.47
Income Return
6.86 6.74 6.80 4.84 3.47
3.47
--- Total
Return
6.08
4.45
20.36
(0.40)
Total
Return
6.08
4.45
20.36
(0.40)
8.14
Total Return
6.08 4.45 20.36 (0.40) 8.14
8.14
Maybank
Islamic
Berhad‟s
12
Months
Maybank
Islamic
Berhad‟s
12
Months
Maybank Islamic Berhad‟s 12 Months
General
3.42
General
Investment
Account
Rate
3.42
3.21
3.21
3.21
2.99
General Investment
Investment Account
Account Rate
Rate
3.42 3.21
3.21 3.21
3.21 3.21
3.21 2.99
2.99
77
7
8
A combination of benchmark/composite benchmark has been used for the
performance computation as follows:
From 25 November 2002 - 31 December Maybank Islamic Berhad‟s 12 Months
2015
General Investment Account Rate
1 January 2016 onwards
Maybank Islamic Berhad‟s 12 months
Islamic Fixed Deposit-I
Note : Past performance is not necessarily indicative of future performance and
unit prices and investment returns may go down, as well as up.
The abovementioned performance computations have been adjusted to
reflect distribution payments and unit splits wherever applicable.
Fund Size
Net Asset Value (RM million)
Units In Circulation (million)
Net Asset Value Per Unit (RM)
Historical Data
Unit Prices
NAV Price - Highest
- Lowest
Distribution and Unit Split
Gross Distribution Per Unit (sen)
Net Distribution Per Unit (sen)
Distribution Date
As at
31.03.2016
72.33
53.09
1.3623
As At 30 September
2015 2014 2013
42.99* 33.84* 23.29*
33.14* 25.90* 17.44*
1.2971* 1.3067* 1.3353*
01.10.201531.03.2016
Financial Year Ended
30 September
2015 2014 2013
1.3623 1.3994* 1.3939* 1.4151*
1.2974 1.2929* 1.3056* 1.2832*
NAV before distribution (cum)
NAV after distribution (ex)
- 8.9000 8.8000 8.0000
- 8.9000 8.8000 8.0000
- 28 Sept 25 Sept 30 Sept
2015 2014 2013
- 1.3869 1.3937 1.4153
- 1.2979 1.3057 1.3353
Unit Split
-
-
-
-
1.01
1.20
0.97
3.21
0.21
0.90
0.42
1.24
Others
Management Expense Ratio (MER)
(%) #
Portfolio Turnover Ratio (PTR)
(times) ##
* ex-distribution
9
9
# The MER for the financial period was higher compared with the previous
financial period due to higher expenses incurred by the Fund during the
financial period under review (refer to Note 12).
## The PTR for the financial period was lower compared with the previous
financial period due to lesser investment activities during the financial period
under review (refer to Note 13).
DISTRIBUTION
During the financial period under review, no distribution has been proposed for the
Fund.
PORTFOLIO STRUCTURE AS AT 31 MARCH 2016
Liquid assets and
other current assets
28.51%
Unquoted Sukuk
71.49%
The asset allocations of the Fund as at reporting date were as follows:
As at
31.03.2016
%
Unquoted sukuk
Liquid assets and other net current
assets
71.49
As at 30 September
2015 2014 2013
%
%
%
98.65
93.92
77.77
28.51
1.35
6.08 22.23*
100.00 100.00 100.00 100.00
The portfolio asset allocation has been relatively well-invested during the financial
period under review, which reflected the Fund Manager‟s tactical strategy in line
with the market outlook, as well as managing liquidity risk.
10
10
* Note: Ample Zone Bhd has been classified as receivable as it has matured on 27
January 2012. Following the downgrade in its rating, the fund manager has
maintained the bond’s valuation at the last fair value price quoted by Bond
Pricing Agency Malaysia (“BPAM”), pending further developments. The
redemption amount receivable has been fully recovered during the financial
year ended 30 September 2014.
FUND SIZE AND PROFILE OF UNIT HOLDINGS BY SIZE
As at 31 March 2016, the Fund‟s units in circulation stood at 53.09 million units
with a total of 344 accounts.
Size of Holdings
5,000 and below
5,001 to 10,000
10,001 to 50,000
50,001 to 500,000
500,001 and above
Total
Account Holders
No.
%
164
47.67
55
15.99
89
25.87
25
7.27
11
3.20
344
100.00
No. Of Units Held*
(„000)
%
260
0.49
405
0.76
2,078
3.92
2,781
5.24
47,552
89.59
53,076
100.00
* Excluding Manager‟s stock
REBATES AND SOFT COMMISSION
Dealings on investments of the Fund through brokers or dealers will be on terms
which are best available for the Fund. Any rebates from brokers or dealers will be
directed to the account of the Fund.
The Fund Manager may only receive soft commission in the form of research and
advisory services that assist in the decision-making process relating to the Fund‟s
investments.
During the financial period under review, the Manager did not receive or utilise
any soft commission from brokers/dealers in consideration for directing dealings
in the investment of the Fund. However, in the event the Manager were to receive
any soft commission in the future, these will only be retained by the Manager if
they are in the form of goods and services which are of demonstrable benefit to
the unitholders.
11
11
RHB ISLAMIC BOND FUND
(formerly
known asBOND
RHB-OSK
Islamic Bond Fund)
RHB ISLAMIC
FUND
UNAUDITED
STATEMENT
OF Bond
FINANCIAL
(formerly known as RHB-OSK Islamic
Fund) POSITION
AS
AT
31
MARCH
2016
UNAUDITED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2016
Note 31.03.2016
RM
Note 31.03.2016
ASSETS
RM
Financial
ASSETS assets at fair value
through profit
(“FVTPL”)
5 51,707,196
Financial
assetsorat loss
fair value
Islamic
deposits
with
a
licensed
through profit or loss (“FVTPL”)
5 51,707,196
financial
institution
6 20,619,692
Islamic
deposits
with a licensed
Bank
balance
66 20,619,692
99,222
financial institution
Amount
due
from
Manager
425,555
Bank balance
6
99,222
─────────
Amount due from Manager
425,555
TOTAL ASSETS
72,851,665
─────────
─────────
TOTAL ASSETS
72,851,665
─────────
LIABILITIES
Accrued
management fee
496,027
LIABILITIES
Amount
due
to
Trustee
6,400
Accrued management fee
496,027
Income
distribution
payable
Amount due to Trustee
6,400Other
payables
and
accruals
7
21,953
Income distribution payable
Other payables and accruals
7 ─────────
21,953
TOTAL LIABILITIES
524,380
─────────
─────────
TOTAL LIABILITIES
524,380
NET ASSET VALUE
72,327,285
─────────
═════════
NET ASSET VALUE
72,327,285
═════════
UNITHOLDERS‟ FUNDS
Unitholders‟
capitalFUNDS
64,650,000
UNITHOLDERS‟
Retained
earnings
7,677,285
Unitholders‟ capital
64,650,000
─────────
Retained earnings
7,677,285
72,327,285
─────────
═════════
72,327,285
═════════
UNITS IN CIRCULATION
8 53,092,000
UNITS IN CIRCULATION
8 ═════════
53,092,000
NET ASSET VALUE PER UNIT
═════════
(EX-DISTRIBUTION*)
1.3623
NET
ASSET VALUE PER UNIT
═════════
(EX-DISTRIBUTION*)
1.3623
═════════
30.09.2015
RM
30.09.2015
RM
42,412,128
42,412,128
3,991,033
3,945
3,991,033
15,748
3,945
─────────
15,748
46,422,854
─────────
─────────
46,422,854
─────────
452,788
3,983
452,788
2,948,926
3,983
25,697
2,948,926
─────────
25,697
3,431,394
─────────
─────────
3,431,394
42,991,460
─────────
═════════
42,991,460
═════════
37,873,035
5,118,425
37,873,035
─────────
5,118,425
42,991,460
─────────
═════════
42,991,460
═════════
33,144,000
═════════
33,144,000
═════════
1.2971*
═════════
1.2971*
═════════
The accompanying notes are an integral part of the financial statements.
The accompanying notes are an integral part of the financial statements.
12
12
12
RHB ISLAMIC BOND FUND
(formerly
known asBOND
RHB-OSK
Islamic Bond Fund)
RHB ISLAMIC
FUND
UNAUDITED
STATEMENT
OF Bond
COMPREHENSIVE
INCOME
(formerly known as RHB-OSK Islamic
Fund)
FOR
THE
FINANCIAL
PERIOD
ENDED
31
MARCH
2016
UNAUDITED STATEMENT OF COMPREHENSIVE INCOME
FOR THE FINANCIAL PERIOD ENDED 31 MARCH 2016
01.10.2015
01.10.2014
Note to 01.10.2015
31.03.2016 to01.10.2014
31.03.2015
RM to 31.03.2015
RM
Note to 31.03.2016
RM
RM
INVESTMENT INCOME
Profit
income fromINCOME
Islamic deposits
INVESTMENT
with
licensed
financial
institutions
Profit income from Islamic
deposits
Profit
income
from
unquoted
sukuk
with licensed financial institutions
Net
on financial
assets atsukuk
FVTPL
Profitgain
income
from unquoted
Net gain on financial assets at FVTPL
EXPENSES
Management
EXPENSES fee
Trustee‟s
fee fee
Management
Audit
fee
Trustee‟s fee
Tax
Auditagent‟s
fee fee
Other
expenses
Tax agent‟s
fee
Other expenses
5
5
9
109
10
130,965
1,196,177
130,965
1,763,208
1,196,177
─────────
1,763,208
3,090,350
─────────
─────────
3,090,350
─────────
(467,950)
(26,256)
(467,950)
(4,250)
(26,256)
(1,900)
(4,250)
(31,134)
(1,900)
─────────
(31,134)
(531,490)
─────────
─────────
(531,490)
─────────
2,558,860
Profit before taxation
Profit before taxation
2,558,860
Taxation
11
Taxation
11 ─────────Profit after taxation and total comprehensive
─────────
income
the financial
yearcomprehensive
2,558,860
Profit
afterfortaxation
and total
═════════
income for the financial year
2,558,860
═════════
Profit after taxation is made up as follows:
Realised
1,204,736
Profit afteramount
taxation is made up as follows:
Unrealised
amount
1,354,124
Realised amount
1,204,736
─────────
Unrealised amount
1,354,124
2,558,860
─────────
═════════
2,558,860
═════════
74,584
904,225
74,584
739,524
904,225
─────────
739,524
1,718,333
─────────
─────────
1,718,333
─────────
(255,891)
(19,795)
(255,891)
(4,250)
(19,795)
(2,500)
(4,250)
(1,885)
(2,500)
─────────
(1,885)
(284,321)
─────────
─────────
(284,321)
─────────
1,434,012
1,434,012
──────────────────
1,434,012
═════════
1,434,012
═════════
1,158,346
275,666
1,158,346
─────────
275,666
1,434,012
─────────
═════════
1,434,012
═════════
The accompanying notes are an integral part of the financial statements.
The accompanying notes are an integral part of the financial statements.
13
13
13
RHB ISLAMIC BOND FUND
(formerly
known asBOND
RHB-OSK
Islamic Bond Fund)
RHB ISLAMIC
FUND
UNAUDITED
STATEMENT
OF Bond
CHANGES
(formerly known as RHB-OSK Islamic
Fund) IN NET ASSET VALUE
FOR
THE
FINANCIAL
PERIOD
ENDED
31 IN
MARCH
2016 VALUE
UNAUDITED STATEMENT OF CHANGES
NET ASSET
FOR THE FINANCIAL PERIOD ENDED 31 MARCH 2016
Unitholders‟
Retained
Total net
capital
earnings
asset
Unitholders‟
Retained
Totalvalue
net
RM
RM
RM
capital
earnings
asset value
RM
RM
RM
Balance as at 1 October 2014
28,262,995
5,576,760
33,839,755
Balance as at 1 October 2014
28,262,995
5,576,760
33,839,755
Movement in net asset value:
Total comprehensive
Movement
in net asset income
value:
for
the
financial
yearincome
1,434,012
1,434,012
Total comprehensive
Creation
of
units
arising
for the financial year
1,434,012
1,434,012
from distribution
1,211,429
1,211,429
Creation
of units arising
Creation
of units arising
from distribution
1,211,429
1,211,429
from applications
9,320,016
9,320,016
Creation
of units arising
Cancellation
of units
(1,316,897)
(1,316,897)
from applications
9,320,016
-9,320,016
─────────
Cancellation of units
(1,316,897) ─────────- ─────────
(1,316,897)
Balance as at 31 March 2015 ─────────
37,477,543 ─────────
7,010,772 ─────────
44,488,315
Balance as at 31 March 2015 ═════════
37,477,543 ═════════
7,010,772 ═════════
44,488,315
═════════ ═════════ ═════════
Balance as at 1 October 2015
Balance as at 1 October 2015
Movement in net asset value:
Total comprehensive
Movement
in net asset income
value:
for the
financial yearincome
Total
comprehensive
Creation
of units arising
for the financial
year
from
distribution
Creation of units arising
Creation
of units arising
from distribution
from
applications
Creation of units arising
Cancellation
of units
from applications
Cancellation of units
Balance as at 31 March 2016
Balance as at 31 March 2016
37,873,035
37,873,035
5,118,425
5,118,425
42,991,460
42,991,460
1,415,052
1,415,052
26,564,358
(1,202,445)
26,564,358
─────────
(1,202,445)
64,650,000
─────────
═════════
64,650,000
═════════
2,558,860
2,558,860
-─────────7,677,285
─────────
═════════
7,677,285
═════════
2,558,860
2,558,860
1,415,052
1,415,052
26,564,358
(1,202,445)
26,564,358
─────────
(1,202,445)
72,327,285
─────────
═════════
72,327,285
═════════
The accompanying notes are an integral part of the financial statements.
The accompanying notes are an integral part of the financial statements.
14
14
14
RHB ISLAMIC BOND FUND
RHB
ISLAMIC
FUND
(formerly
known asBOND
RHB-OSK
Islamic Bond Fund)
(formerly known as RHB-OSK Islamic Bond Fund)
UNAUDITED STATEMENT OF CASH FLOWS
UNAUDITED STATEMENT OF CASH FLOWS
FOR THE FINANCIAL PERIOD ENDED 31 MARCH 2016
FOR THE FINANCIAL PERIOD ENDED 31 MARCH 2016
01.10.2015
01.10.2014
01.10.2015
01.10.2014
Note to 31.03.2016 to 31.03.2015
Note to 31.03.2016 to 31.03.2015
RM
RM
RM
RM
CASH FLOWS FROM OPERATING
CASH FLOWS FROM OPERATING
ACTIVITIES
ACTIVITIES
Proceeds
from sale of investments
Proceeds from sale of investments
Proceeds from redemption of unquoted sukuk
Proceeds from redemption of unquoted sukuk
Purchase of investments
Purchase of investments
Profit income received from Islamic deposits
Profit income received from Islamic deposits
with licensed financial institutions
with licensed financial institutions
Profit income received from unquoted sukuk
Profit income received from unquoted sukuk
Management fee paid
Management fee paid
Trustee‟s fee paid
Trustee‟s fee paid
Payment for other fees and expenses
Payment for other fees and expenses
Net cash used in operating activities
Net cash used in operating activities
CASH FLOWS FROM FINANCING
CASH FLOWS FROM FINANCING
ACTIVITIES
ACTIVITIES
Cash proceeds from units created
Cash proceeds from units created
Payment for cancellation of units
Payment for cancellation of units
Payment for income distribution
Payment for income distribution
Net cash generated from financing activities
Net cash generated from financing activities
Net decrease in cash and cash equivalents
Net decrease in cash and cash equivalents
Cash and cash equivalents at the beginning
Cash and cash equivalents at the beginning
of the financial year
of the financial year
Cash and cash equivalents at the end
Cash and cash equivalents at the end
of the financial year
of the financial year
Cash and cash equivalents comprise:
Cash and cash equivalents comprise:
Islamic deposits with licensed
Islamic deposits with licensed
financial institutions
financial institutions
Bank balance
Bank balance
6
6
6
6
7,271,310
7,271,310
(14,694,400)
(14,694,400)
15,337,400
15,337,400
4,267,320
4,267,320
(24,178,250)
(24,178,250)
130,965
130,965
1,087,408
1,087,408
(424,711)
(424,711)
(23,839)
(23,839)
(41,029)
(41,029)
────────
────────
(6,694,296)
(6,694,296)
────────
────────
74,584
74,584
931,558
931,558
(273,616)
(273,616)
(20,628)
(20,628)
(9,964)
(9,964)
────────
────────
(3,871,596)
(3,871,596)
────────
────────
27,569,603
27,569,603
(1,202,445)
(1,202,445)
(2,948,926)
(2,948,926)
────────
────────
23,418,232
23,418,232
────────
────────
16,723,936
16,723,936
10,532,020
10,532,020
(1,302,004)
(1,302,004)
(2,277,440)
(2,277,440)
────────
────────
6,952,576
6,952,576
────────
────────
3,080,980
3,080,980
3,994,978
3,994,978
────────
────────
4,619,038
4,619,038
────────
────────
20,718,914
20,718,914
════════
════════
7,700,018
7,700,018
════════
════════
20,619,692
20,619,692
99,222
99,222
────────
────────
20,718,914
20,718,914
════════
════════
4,094
4,094
7,695,924
7,695,924
────────
────────
7,700,018
7,700,018
════════
════════
The accompanying notes are an integral part of the financial statements.
The accompanying notes are an integral part of the financial statements.
15
15
15
RHB ISLAMIC BOND FUND
(formerly known as RHB-OSK Islamic Bond Fund)
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
FOR THE FINANCIAL PERIOD ENDED 31 MARCH 2016
1 THE FUND, THE MANAGER AND THEIR PRINCIPAL ACTIVITIES
The RHB Islamic Bond Fund (formerly known as RHB-OSK Islamic Bond Fund)
(hereinafter referred to as “the Fund”) was constituted pursuant to the execution of
a Deed dated 14 August 2000 and Supplemental Deeds dated 10 August 2001, 23
August 2007 and 25 January 2008 between RHB Asset Management Sdn Bhd (“the
Manager”), CIMB Islamic Trustee Berhad (“the Trustee”) and the registered
unitholders of the Fund. The Fund is now governed by a Master Deed dated 12
June 2008 and subsequent Supplemental Master Deeds (collectively referred to as
“the Deeds”), which shall hereafter supersede all existing deeds relating to the
Fund.
The Fund was launched on 25 August 2000 and will continue its operations until
terminated as provided under Clause 4 of the Master Deed.
The principal activity of the Fund is to invest in 'Permitted Investments' as defined
under Item 15 of Schedule 2 of the Master Deed, which includes sukuk, all types of
Islamic collective investment schemes, Islamic money market instruments and any
other form of investments as may be approved by the relevant authorities from time
to time and acceptable under the Shariah principles.
The Fund‟s activities shall be conducted strictly in accordance with the requirement
of the Shariah principles and shall be monitored by the Shariah Adviser of the
Fund.
All investments will be subject to the Securities Commission‟s (“SC”) Guidelines
on Unit Trust Funds, SC requirements, the Deeds, except where exemptions or
variations have been approved by the SC, internal policies and procedures and
objective of the Fund.
The main objective of the Fund is to provide regular income to investors through
investments in Islamic fixed income instruments and sukuk which are acceptable
investments under the principles of Shariah.
The Fund has changed its name to RHB Islamic Bond Fund with effect from 15
July 2015.
16
16
17
18
19
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
2.2 Financial assets (continued)
Recognition and measurement
Regular purchases and sales of financial assets are recognised on the trade date, the
date on which the Fund commits to purchase or sell the asset. Investments are
initially recognised at fair value. Subsequent to initial recognition, financial assets
at fair value through profit or loss are measured at fair value.
Financial assets are de-recognised when the rights to receive cash flows from the
investments have expired or have been transferred and the Fund has transferred
substantially all risks and rewards of ownership.
Unrealised gains or losses arising from changes in the fair value of the „financial
assets at fair value through profit or loss‟ category are presented in the statement of
comprehensive income in the financial period in which they arise.
Unquoted sukuk denominated in Ringgit Malaysia are revalued on a daily basis
based on fair value prices quoted by a bond pricing agency (“BPA”) registered
with the SC as per the SC Guidelines on Unit Trust Funds. Where such quotations
are not available or where the Manager is of the view that the price quoted by the
BPA for a specific unquoted sukuk differs from the market price by more than 20
basis points, the Manager may use the market price, provided that the Manager:
(i) Records its basis for using a non-BPA price;
(ii) Obtains necessary internal approvals to use the non-BPA price; and
(iii) Keeps an audit trail of all decisions and basis for adopting the market price.
Islamic deposits with licensed financial institutions are stated at cost plus accrued
profit calculated on the effective profit method over the period from the date of
placement to the date of maturity of the respective deposits, which is a reasonable
estimate of fair value due to the short-term nature of the deposits.
Financing and receivables are subsequently carried at amortised cost using the
effective profit method.
20
20
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
2.2 Financial assets (continued)
Impairment of financial assets
For assets carried at amortised cost, the Fund assesses at the end of the reporting
year whether there is objective evidence that a financial asset or group of financial
assets is impaired. A financial asset or a group of financial assets is impaired and
impairment losses are incurred only if there is objective evidence of impairment as
a result of one or more events that occurred after the initial recognition of the asset
(a „loss event‟) and that loss event (or events) has an impact on the estimated future
cash flows of the financial asset or group of financial assets that can be reliably
estimated.
The amount of the loss is measured as the difference between the asset‟s carrying
amount and the present value of estimated future cash flows (excluding future
credit losses that have not been incurred) discounted at the financial asset‟s original
effective profit rate. The asset‟s carrying amount of the asset is reduced and the
amount of the loss is recognised in the statement of comprehensive income. If
„financing and receivables‟ has a variable profit rate, the discount rate for
measuring any impairment loss is the current effective profit rate determined under
the contract. As a practical expedient, the Fund may measure impairment on the
basis of an instrument‟s fair value using an observable market price.
If, in a subsequent financial period, the amount of the impairment loss decreases
and the decrease can be related objectively to an event occurring after the
impairment was recognised (such as an improvement in the debtor‟s credit rating),
the reversal of the previously recognised impairment loss is recognised in profit or
loss. When an asset is uncollectible, it is written off against the related allowance
account. Such assets are written off after all the necessary procedures have been
completed and the amount of the loss has been determined.
2.3 Financial liabilities
Financial liabilities are classified according to the substance of the contractual
arrangements entered into and the definitions of a financial liability.
Financial liabilities, within the scope of MFRS 139 “Financial Instruments:
Recognition and Measurement”, are recognised in the statement of financial
position when, and only when, the Fund becomes a party to the contractual
provisions of the financial instrument.
21
21
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
2.3 Financial liabilities (continued)
The Fund‟s financial liabilities which include accrued management fee, amount
due to Trustee, income distribution payable and other payables and accruals are
recognised initially at fair value plus directly attributable transaction costs and
subsequently measured at amortised cost using the effective profit method.
A financial liability is de-recognised when the obligation under the liability is
extinguished. Gains and losses are recognised in profit or loss when the liabilities
are de-recognised, and through the amortisation process.
2.4 Unitholder‟s Capital
The unitholders‟ contributions to the Fund meet the criteria to be classified as
equity instruments under MFRS 132 “Financial Instruments: Presentation”. Those
criteria include:
the units entitle the holder to a proportionate share of the Fund‟s net assets
value;
the units are the most subordinated class and class features are identical;
there is no contractual obligations to deliver cash or another financial asset
other than the obligation on the Fund to repurchase; and
the total expected cash flows from the units over its life are based
substantially on the profit or loss of the Fund.
The outstanding units are carried at the redemption amount that is payable at each
financial year if unitholder exercises the right to put the unit back to the Fund.
Units are created and cancelled at prices based on the Fund‟s net asset value per
unit at the time of creation or cancellation. The Fund‟s net asset value per unit is
calculated by dividing the net assets attributable to unit holders with the total
number of outstanding units.
2.5 Distribution
Distributions are at the discretion of the Fund. A distribution to the Fund‟s
unitholders is accounted for as a deduction from realised reserves. A proposed
distribution is recognised as a liability in the period in which it is approved by the
Board of Directors of the Manager.
22
22
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
2.6 Income recognition
Profit income from Islamic deposits with licensed financial institutions and
unquoted sukuk are recognised on an accrual basis using the effective profit
method.
Realised gain and loss on sale of unquoted sukuk is measured by the difference
between the net disposal proceeds and the carrying amounts of the investment,
determined on cost adjusted for accretion of discount or amortisation of premium.
2.7 Taxation
Current tax expense is determined according to Malaysian tax laws and includes all
taxes based upon the taxable income earned during the financial period.
2.8 Cash and cash equivalents
For the purpose of the statement of cash flows, cash and cash equivalents comprise
bank balances and Islamic deposits with a licensed financial institution that are
readily convertible to known amounts of cash and which are subject to an
insignificant risk of changes in value.
2.9 Presentation and functional currency
Items included in the financial statements of the Fund are measured using the
currency of the primary economic environment in which the Fund operates (the
“functional currency”). The financial statements are presented in Ringgit Malaysia,
which is the Fund‟s presentation and functional currency.
2.10 Segmental information
Operating segments are reported in a manner consistent with the internal reporting
used by the chief operating decision-maker. The operating results are regularly
reviewed by the Manager and the Investment Committee. The Investment
Committee assumes the role of chief operating decision maker, for performance
assessment purposes and to make decisions about resources allocated to the
investment segment based on the recommendation by the Investment & Security
Selection Committee.
23
23
3
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Fund is exposed to a variety of risks, which include management risk, price
risk, profit rate risk, credit/default risk, liquidity risk, issuer risk, non-compliance
risk, Shariah specific risk and capital risk.
Financial risk management is carried out through internal control processes
adopted by the Manager and adherence to the investment restrictions as stipulated
in the SC Guidelines on Unit Trust Funds.
Management risk
Poor management of the Fund may jeopardise the investment of each unitholder.
Therefore, it is important for the Manager to set the investment policies and
appropriate strategies to be in line with the investment objective before any
investment activities can be considered. However, there can be no guarantee that
these measures will produce the desired results.
Price risk
Price risk is the risk that the fair value of an investment of the Fund will fluctuate
because of changes in market prices (other than those arising from profit rate risk).
The Fund‟s overall exposure to price risk was as follows:
31.03.2016
RM
30.09.2015
RM
Financial assets at fair value through profit or loss 51,707,196*
════════
42,412,128*
════════
* Includes profit receivable of RM655,313 (30.09.2015: RM579,128).
24
24
3
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
(CONTINUED)
Price risk (continued)
The table below summarises the sensitivity of the Fund‟s profit after tax and net
asset value to movements in prices of investments. The analysis is based on the
assumption that the price of the investments fluctuates by 5% with all other
variables held constant.
31.03.2016
30.09.2015
Change in price
of investments
%
Impact on
profit after tax and
Market value
net asset value
RM
RM
-5
0
+5
═════════
48,499,289
51,051,883
53,604,477
═════════
(2,552,594)
2,552,594
═════════
-5
0
+5
═════════
39,741,350
41,833,000
43,924,650
═════════
(2,091,650)
2,091,650
═════════
Profit rate risk
In general, when profit rates rise, unquoted sukuk prices will tend to fall and vice
versa. Therefore, the NAV of the Fund may also tend to fall when profit rates rise
or are expected to rise. However, investors should be aware that should the Fund
hold an unquoted sukuk till maturity, such price fluctuations would dissipate as it
approaches maturity, and thus the growth of the NAV shall not be affected at
maturity. In order to mitigate profit rates exposure of the Fund, the Manager will
manage the duration of the portfolio via shorter or longer tenured assets depending
on the view of the future profit rate trend of the Manager, which is based on its
continuous fundamental research and analysis.
This risk is crucial since bond portfolio management depends on forecasting profit
rate movements. Sukuk with longer maturity and lower yield coupon rates are
more susceptible to profit rate movements.
25
25
3
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
(CONTINUED)
Profit rate risk (continued)
Investors should note that unquoted sukuk (such as the sukuk held by the Fund)
and money market instruments are subject to profit rate fluctuations. Such
investments may be subject to unanticipated rise in profit rates which may impair
the ability of the issuers to make payments of profit and principal, especially if the
issuers are highly leveraged. An increase in profit rates may therefore increase the
potential for default by an issuer.
The table below summarises the sensitivity of the Fund‟s net asset value to
movements in prices of unquoted sukuk held by the Fund as a result of movement
in profit rate. The analysis is based on the assumptions that the profit rate increased
and decreased by 1% with all other variables held constant.
% Change in profit rate
+ 1%
- 1%
Impact on profit after tax/net asset value
31.03.2016 30.09.2015
RM
RM
(235,931) (199,791)
237,838
201,224
═════════ ════════
Credit/default risk
This refers to the likelihood that the company issuing the bonds/sukuk and/or
financial institution where liquid assets of the Fund are deposited may default.
Securities are subject to varying degrees of credit risk, which are often reflected in
credit ratings. Municipal bonds/sukuk are subject to the risk that litigation,
legislation or other political events, local business or economic conditions, or the
bankruptcy of an issuer could have a significant effect on the issuer‟s ability to
make payments of principal and/or profit. A unit trust fund could lose money if the
issuer or guarantor of a fixed income security, or the counterpart to a derivatives
contract, repurchase agreement or a financial institution, is unable or unwilling to
make timely principal and/or profit payments, or to otherwise honour its
obligations.
26
26
3
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
(CONTINUED)
Credit/default risk (continued)
Credit risk can be managed by performing continuous fundamental credit research
and analysis to ascertain the creditworthiness of its issuer and/or financial
institution. This risk refers to the possibility that the issuer of an instrument and/or
financial institution will not be able to make timely payments of profit or principal
repayment on the maturity date, where applicable. This may lead to a default in the
payment of principal and profit and ultimately a reduction in the value of the Fund.
The following table sets out the credit risk concentrations of the Fund.
31.03.2016
- AAA
-AA1
- AA2
- AA3
- AA
- AA+
- AA-A
- A2
- A3
Others
Unquoted
sukuk
RM
Cash and
cash
equivalents
RM
Other
financial
assets*
RM
Total
RM
8,773,018
2,056,561
8,415,147
10,330,234
4,373,930
2,037,564
4,406,534
7,429,013
1,223,336
2,661,859
51,707,196
11,201,831
9,517,083
20,718,914
425,555
425,555
19,974,849
2,056,561
8,415,147
10,330,234
4,373,930
2,037,564
4,406,534
7,429,013
10,740,419
2,661,859
425,555
72,851,665
* Comprise amount due from Manager
27
27
3
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
(CONTINUED)
Credit/default risk (continued)
30.09.2015
- AAA
-AA1
- AA2
- AA3
- AA
- AA+
- AA-A
- A2
Others
Cash and
Unquoted
cash
sukuk equivalents
RM
RM
1,725,934
2,000,430
11,962,070
10,029,919
4,308,512
2,005,874
3,055,206
7,324,183
42,412,128
3,994,978
3,994,978
Other
financial
assets*
RM
Total
RM
15,748
15,748
1,725,934
2,000,430
11,962,070
10,029,919
4,308,512
2,005,874
3,055,206
7,324,183
3,994,978
15,748
46,422,854
* Comprise amount due from Manager
The financial assets of the Fund are neither past due nor impaired.
Liquidity risk
Liquidity risk is the risk that the Fund will encounter difficulty in meeting its
financial obligations.
Liquidity risk exists when particular investments are difficult to sell, possibly
preventing a unit trust fund from selling such illiquid securities at an advantageous
time or price. Unit trust funds with principal investment strategies that involve
securities or securities with substantial market and/or credit risk tend to have the
greater exposure to liquidity risk. As part of its risk management, the Manager will
attempt to manage the liquidity of the Fund through asset allocation and
diversification strategies within the portfolio. The Manager will also conduct
constant fundamental research and analysis to forecast future liquidity of its
investments.
28
28
3
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
(CONTINUED)
Liquidity risk (continued)
The table below summarises the Fund‟s financial liabilities into relevant maturity
groupings based on the remaining period from the statement of financial position
date to the contractual maturity date. The amounts in the table are the contractual
undiscounted cash flows.
31.03.2016
Accrued management fee
Amount due to Trustee
Other payables and accruals
30.09.2015
Accrued management fee
Amount due to Trustee
Income distribution payable
Other payables and accruals
Less than
1 month
RM
Between
1 month
to 1 year
RM
496,027
6,400
─────────
502,427
═════════
21,953
─────────
21,953
═════════
452,788
3,983
2,948,926
─────────
3,405,697
═════════
25,697
─────────
25,697
═════════
Issuer risk
The value of each sukuk that the Fund invests in may decline for a number of
reasons which is directly related to the issuer, such as, the management
performance, financial leverage and reduced demand for the issuer‟s goods or
services. The Manager aims to reduce all these risks by using diversification that is
expected to reduce the volatility as well as the risk for the Fund‟s portfolio.
29
29
3
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
(CONTINUED)
Non-compliance risk
This is the risk of the Manager not complying with the internal policies, the Deeds
of the Fund, all applicable laws or guidelines issued by the regulators. This may
occur as a result of system failure or the inadvertence of the Manager. The
magnitude of such risk and its impact on the Fund and/or unitholders are dependent
on the nature and severity of the non-compliance. Non-compliance may adversely
affect the Fund especially if the investment of the Fund has to be disposed at a
lower price to rectify the non-compliance.
Shariah specific risk
The risk that the investments do not conform to the principle of Shariah may result
in those investments being not Shariah compliant. Should the situation arise,
necessary steps shall be taken to dispose of such investments in accordance with
the rules of divestment of non Shariah-compliant investments. If this occurs, the
Fund could suffer losses from the disposal and thus, adversely affecting the value
of the Fund.
Capital risk
The capital of the Fund is represented by equity consisting of unitholders‟ capital
and retained earnings. The amount of equity can change significantly on a daily
basis as the Fund is subject to daily subscriptions and redemptions at the discretion
of unitholders. The Fund‟s objective when managing capital is to safeguard the
Fund‟s ability to continue as a going concern in order to provide returns for
unitholders and benefits for other stakeholders and to maintain a strong capital base
to support the development of the investment activities of the Fund.
4
FAIR VALUE ESTIMATION
Fair value is defined as the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at the
measurement date (i.e. an exit price).
The fair value of financial assets traded in active market (such as publicly traded
derivatives and trading securities) are based on quoted market prices at the close of
trading on the financial period end date.
30
30
4
FAIR VALUE ESTIMATION (CONTINUED)
An active market is a market in which transactions for the asset or liability take
place with sufficient frequency and volume to provide pricing information on an
ongoing basis.
The fair value of financial assets that are not traded in an active market is
determined by using valuation techniques. The Fund uses a variety of methods and
makes assumptions that are based on market conditions existing at each year end
date. Valuation techniques used for non-standardised financial instruments such as
options, currency swaps and other over-the-counter derivatives, include the use of
comparable recent transactions, reference to other instruments that are substantially
the same, discounted cash flow analysis, option pricing models and other valuation
techniques commonly used by market participants making the maximum use of
market inputs and relying as little as possible on entity-specific inputs.
For instruments for which there is no active market, the Fund may use internally
developed models, which are usually based on valuation methods and techniques
generally recognised as standard within the industry. Valuation models are used
primarily to value unlisted equities, debt securities and other debt instruments for
which market were or have been inactive during the financial year. Some of the
inputs to these models may not be market observable and are therefore estimated
based on assumptions.
The output of a model is always an estimate or approximation of a value that
cannot be determined with certainty, and valuation techniques employed may not
fully reflect all factors relevant to the positions the Fund holds.
Valuations are therefore adjusted, where appropriate, to allow for additional factors
including model risk, liquidity risk and counterparty risk.
The fair values are based on the following methodologies and assumptions:
(i) For bank balance and deposits and placements with financial institutions with
maturities less than 1 year, the carrying value is a reasonable estimate of fair
value.
(ii) The carrying value of receivables and payables are assumed to approximate
their fair values. The carrying values of financial assets and financial liabilities
approximate their fair values due to their short term nature.
31
31
4
FAIR VALUE ESTIMATION (CONTINUED)
Fair value hierarchy
The Fund adopted MFRS 13 “Fair Value Measurement” in respect of disclosures
about the degree of reliability of fair value measurement. This requires the Fund to
classify fair value measurements using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements. The fair value
hierarchy has the following levels:
Level 1: Quoted prices (unadjusted) in active market for identical assets or
liabilities
Level 2: Inputs other than quoted prices included within level 1 that are
observable for the asset or liability, either directly (that is, as prices) or
indirectly (that is, derived from prices)
Level 3: Inputs for the asset and liability that are not based on observable
market data (that is, unobservable inputs)
The level in the fair value hierarchy within which the fair value measurement is
categorised in its entirety is determined on the basis of the lowest level input that is
significant to the fair value measurement in its entirety. For this purpose, the
significance of an input is assessed against the fair value measurement in its
entirety. If a fair value measurement uses observable inputs that require significant
adjustment based on unobservable inputs, that measurement is a level 3
measurement. Assessing the significance of a particular input to the fair value
measurement in its entirety requires judgment, considering factors specific to the
asset or liability.
The determination of what constitutes „observable‟ requires significant judgment
by the Fund. The Fund considers observable data to be that market data that is
readily available, regularly distributed or updated, reliable and verifiable, not
proprietary, and provided by independent sources that are actively involved in the
relevant market.
32
32
4
FAIR VALUE ESTIMATION (CONTINUED)
Fair value hierarchy (continued)
The following table analyses within the fair value hierarchy the Fund‟s financial
assets (by class) measured at fair value:
Level 1
RM
Level 2
RM
Level 3
RM
Total
RM
31.03.2016
Financial assets at fair value
through profit or loss
- Unquoted sukuk
- 51,707,196
- 51,707,196
════════ ════════ ═══════ ════════
30.09.2015
Financial assets at fair value
through profit or loss
- Unquoted sukuk
- 42,412,128
- 42,412,128
════════ ════════ ═══════ ════════
Financial instruments that trade in markets that are considered to be active but are
valued based on quoted market prices, dealer quotations or alternative pricing
sources supported by observable inputs are classified within Level 2. Level 2
instruments include unquoted sukuk. As Level 2 instruments include positions that
are not traded in active markets and/or are subject to transfer restrictions,
valuations may be adjusted to reflect illiquidity and/or non-transferability, which
are generally based on available market information. The Fund‟s policies on
valuation of these financial assets are stated in Note 2.2.
33
33
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS
Financial assets designated as FVTPL:
- Unquoted sukuk
Net gain on financial assets at FVTPL comprised:
- Net realised gain on sale of
financial assets at FVTPL
- Net unrealised gain/(loss) on changes
in fair value
31.03.2016
RM
30.09.2015
RM
51,707,196
════════
42,412,128
════════
31.03.2016
RM
30.09.2015
RM
409,083
575,075
1,354,125
────────
1,763,208
════════
( 231,133)
────────
343,942
════════
Financial assets designated as FVTPL as at 31 March 2016 are as follows:
Fair value
as at
Cost 31.03.2016
RM
RM
Fair value
as at 31.03.2016
expressed as a
percentage of
value of the Fund
%
5.30% Alpha Circle Sdn
Bhd 19/11/2020 AA- 1,300,000 1,322,690 1,345,081
1.86
5.30% Alpha Circle Sdn
Bhd 23/02/2021 AA- 2,000,000 2,011,036 2,042,336
2.82
6.00% Alpha Circle Sdn
Bhd 31/05/2023 A
7,000,000 7,296,520 7,429,013
10.27
Name of Counter
UNQUOTED SUKUK
Nominal
value
5.70% ANIH Bhd
27/11/2026 AA
2,500,000 2,712,607 2,719,170
3.76
5.85% ANIH Bhd
29/11/2027 AA
1,500,000 1,680,362 1,654,760
2.29
34
34
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS (CONTINUED)
Financial assets designated as FVTPL as at 31 March 2016 are as follows:
(continued)
Fair value
as at 31.03.2016
Fair value expressed as a
Nominal
as at
percentage of
Name of Counter
value
Cost 31.03.2016 value of the Fund
RM
RM
%
UNQUOTED SUKUK
5.60% BGSM
Management Sdn Bhd
27/12/2023 AA3
1,200,000 1,232,444 1,256,202
1.74
2.50% Bright Focus Bhd
IMTN 22/01/2031 AA2 5,000,000 3,211,235 3,467,853
4.79
6.25% EKVE Sdn Bhd
IMTN 29/01/2036 AAA 7,500,000 7,708,534 8,280,882
11.45
5.30% Gulf Investment
Corporation G.S.C.
18/06/2027 A2
1,200,000 1,228,294 1,223,336
1.69
4.85% Kimanis Power
Sdn Bhd
06/08/2021 AA-
1,000,000 1,043,863 1,019,117
1.41
5.17% Konsortium
Prohawk Sdn Bhd
20/06/2025 AA2
2,000,000 2,093,737 2,096,472
2.90
5.33% Konsortium
Prohawk Sdn Bhd
28/12/2032 AA2
2,800,000 2,844,370 2,850,822
3.94
5.72% KT Kira IMTN
15/07/2020 AA3
5,000,000 5,073,061 5,101,584
7.05
35
35
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS (CONTINUED)
Financial assets designated as FVTPL as at 31 March 2016 are as follows:
(continued)
Fair value
as at 31.03.2016
Fair value expressed as a
Nominal
as at
percentage of
Name of Counter
value
Cost 31.03.2016 value of the Fund
RM
RM
%
UNQUOTED SUKUK
5.75% Malaysia Airports
Holdings
14/12/2114 A3
2,500,000 2,542,534 2,661,859
3.68
5.28% Sarawak Energy
Bhd 17/08/2035 AA1
2,000,000 2,012,441 2,056,561
2.84
6.20% Tanjung Bin
Energy Issuer Bhd
16/03/2032 AA3
3,600,000 3,753,420 3,972,448
5.50
4.725% TNB Northern
Energy Bhd
29/11/2034 AAA
500,000
456,046
492,136
0.68
7.20% Tracoma Holdings
Bhd D*
730,615 730,615
-
-
7.20% Tracoma Holdings
Bhd D*
730,615 730,615
-
-
4.58% Westports Malaysia
Sdn Bhd
23/10/2024 AA+
1,000,000 1,022,293 1,016,547
1.41
36
36
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS (CONTINUED)
Financial assets designated as FVTPL as at 31 March 2016 are as follows:
(continued)
Fair value
as at 31.03.2016
Fair value
expressed as a
Nominal
as at
percentage of
Name of Counter
value
Cost 31.03.2016 value of the Fund
RM
RM
%
4.68% Westports Malaysia
Sdn Bhd
23/10/2025 AA+
1,000,000 1,022,937 1,021,017
1.41
──────── ───────
─────
TOTAL UNQUOTED SUKUK
ACCUMULATED UNREALISED
LOSS
TOTAL FINANCIAL ASSETS
AT FVTPL
51,729,654 51,707,196
═══════
71.49
═════
(22,458)
────────
51,707,196
════════
37
37
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS (CONTINUED)
Financial assets designated as FVTPL as at 30 September 2015 are as follows:
Fair value
as at
Cost 30.09.2015
RM
RM
Fair value
as at 30.09.2015
expressed as a
percentage of
value of the Fund
%
5.30% Alpha Circle Sdn
Bhd 19/11/2020 AA- 2,000,000 2,034,827 2,047,446
4.76
6.00% Alpha Circle Sdn
Bhd 31/05/2023 A
7,000,000 7,305,663 7,324,183
17.04
Name of Counter
UNQUOTED SUKUK
Nominal
value
5.70% ANIH Bhd
27/11/2026 AA
2,500,000 2,719,228 2,682,626
6.24
5.85% ANIH Bhd
29/11/2027 AA
1,500,000 1,685,660 1,625,886
3.78
5.25% BGSM
Management Sdn Bhd
24/12/2020 AA3
2,000,000 2,040,550 2,051,041
4.77
5.60% BGSM
Management Sdn Bhd
27/12/2023 AA3
1,200,000 1,233,037 1,244,918
2.89
2.50% Bright Focus Bhd
IMTN 24/01/2030 AA2 2,500,000 1,639,530 1,687,940
3.93
2.50% Bright Focus Bhd
IMTN 22/01/2031 AA2 7,500,000 4,762,401 4,853,070
11.29
5.30% Gulf Investment
Corporation G.S.C.
18/06/2027 AAA
1,200,000 1,228,624 1,251,008
2.91
38
38
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS (CONTINUED)
Financial assets designated as FVTPL as at 30 September 2015 are as follows:
(continued)
Fair value
as at 30.09.2015
Fair value expressed as a
Nominal
as at
percentage of
Name of Counter
value
Cost 30.09.2015 value of the Fund
RM
RM
%
UNQUOTED SUKUK
4.85% Kimanis Power
Sdn Bhd
06/08/2021 AA-
1,000,000 1,047,080 1,007,760
2.34
5.17% Konsortium
Prohawk Sdn Bhd
20/06/2025 AA2
2,000,000 2,096,541 2,050,232
4.77
5.33% Konsortium
Prohawk Sdn Bhd
28/12/2032 AA2
794,669
1.85
3,000,000 3,036,671 3,038,351
7.07
5.75% Malaysia Airports
Holdings
14/12/2114 AA2
2,500,000 2,542,534 2,576,159
5.99
5.28% Sarawak Energy
Bhd 17/08/2035 AA1
2,000,000 2,012,730 2,000,430
4.65
6.20% Tanjung Bin
Energy Issuer Bhd
16/03/2032 AA3
3,600,000 3,754,965 3,695,609
8.60
KT Kira IMTN
15/07/2020 AA3
4.725%TNB Northern
Energy Bhd
29/11/2034 AAA
800,000
500,000
814,491
455,392
474,926
1.11
39
39
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS (CONTINUED)
Financial assets designated as FVTPL as at 30 September 2015 are as follows:
(continued)
Fair value
as at 30.09.2015
Fair value expressed as a
Nominal
as at
percentage of
Name of Counter
value
Cost 30.09.2015 value of the Fund
RM
RM
%
UNQUOTED SUKUK
7.20% Tracoma Holdings
Bhd D*
730,615 686,474
-
-
7.20% Tracoma Holdings
Bhd D*
730,615 646,971
-
-
4.58% Westports Malaysia
Sdn Bhd
23/10/2024 AA+
1,000,000 1,022,353 1,002,237
2.33
4.68% Westports Malaysia
Sdn Bhd
23/10/2025 AA+
1,000,000 1,022,989
1,003,637
2.34
──────── ───────
─────
43,788,711 42,412,128
═══════
98.65
═════
TOTAL UNQUOTED SUKUK
ACCUMULATED UNREALISED
LOSS
(1,376,583)
────────
TOTAL FINANCIAL ASSETS
AT FVTPL
42,412,128
════════
40
40
5
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS (CONTINUED)
* Tracoma Holdings Bhd ("Tracoma") RM100 million Islamic Bai' Bithaman Ajil
Debt Securities ("BaIDS")
On 12 April 2011, Tracoma was granted an extension of the Restraining Order
(“RO”) for another 6 months from 9 December 2010. This means that Tracoma
has protection from any legal action up to the expiry of the RO i.e. 8 June 2011.
Tracoma is expected to refine the restructuring scheme which was rejected by
the BaIDS holders.
On 19 April 2011, Tracoma appointed KAF Investment Bank Bhd as the
company‟s Principal Advisor for the proposed restructuring scheme.
On 9 May 2011, Tracoma was again granted an extension of the RO for a period
of six (6) months effective from 9 June 2011 until 8 December 2011 to restrain
further proceedings against Tracoma Group.
However, as a result of a calling of an Event of Default (EOD) by the BaIDS
holders on 10 October 2011, the Manager has fair valued the BaIDS at zero
value for the financial year ended 30 September 2011 of the Fund.
BDO Consulting Sdn Bhd (“BDO”) was appointed as Receiver and Manager
(“R&M”) on 30 December 2011 to undertaken an asset disposal exercise for the
recovery of Tracoma‟s RM100 million BaIDS.
Most of Tracoma‟s assets have been successfully disposed and the proceeds
were distributed to the BaIDS holders in 4 distributions since December 2012.
The total distribution amount of RM70.78 million translates to a 70.78%
recovery rate to-date. R&M will continue to conclude the assets disposal
exercise but expected recovery is likely to be negligible.
The BaIDS continue to be fair valued at zero value for the financial period
ended 31 March 2016 pending conclusion of the asset disposal exercise.
41
41
6
CASH AND CASH EQUIVALENTS
31.03.2016
RM
30.09.2015
RM
Islamic deposits with licensed financial institutions 20,619,692
Bank balance
99,222
───────
20,718,914
═══════
3,991,033
3,945
───────
3,994,978
═══════
Islamic deposits with a licensed financial institution include profit receivable of
RM1,823 (30.09.2015: RM344).
31.03.2016
RM
30.09.2015
RM
Weighted average rate of return
3.23%
═══════
3.15%
═══════
Average maturity
1 day
═══════
1 day
═══════
7
OTHER PAYABLES AND ACCRUALS
Audit fee payable
Tax agent‟s fee payable
Sundry payables and accruals
31.03.2016
RM
30.09.2015
RM
4,250
12,800
4,903
────────
21,953
════════
8,500
10,900
6,297
────────
25,697
════════
42
42
8
UNITS IN CIRCULATION
At the beginning of the financial period/year
Creation of units during the financial period/year:
Arising from distribution during the
financial period/year
Arising from applications during the
financial period/year
Cancellation of units during the
financial period/year
At the end of the financial period/year
9
31.03.2016
Units
30.09.2015
Units
33,144,000
25,897,000
1,088,000
926,000
19,770,000
8,699,000
(910,000)
────────
53,092,000
════════
(2,378,000)
────────
33,144,000
════════
MANAGEMENT FEE
Item 10 of Schedule 2 of the Master Deed provides that the Manager shall be
entitled to a fee based on a profit sharing scheme between the Manager and the
Fund at a ratio of 15:85 respectively based on the net investment income, which is
the income of the Fund less the Trustee‟s fee and all permitted or allowable
expenses under the Master Deed.
The management fee provided in the financial statements is based on a profit
sharing scheme between the Manager and the Fund at a ratio of 15:85 (2015:
15:85) respectively based on the net investment income for the financial period.
There will be no further liability to the Manager in respect of management fee other
than the amount recognised above.
10
TRUSTEE‟S FEE
Item 11 of Schedule 2 of the Master Deed provides that the Trustee shall be entitled
to a fee at a rate agreed between the Manager and the Trustee which the rate shall
not exceed 0.1% per annum of the net asset value of the Fund, calculated on a daily
basis; subject to a minimum fee of RM35,000 per annum.
The Trustee‟s fee provided in the financial statements is 0.1% (2015: 0.10%) per
annum based on the net asset value of the Fund, calculated on a daily basis for the
financial period.
There will be no further liability to the Trustee in respect of Trustee‟s fee other than
the amount recognised above.
43
43
11
TAXATION
(a) Tax charge for the financial period
01.10.2015
01.10.2014
to 31.03.2016 to 31.03.2015
RM
RM
Current taxation
════════
════════
(b) Numerical reconciliation of income tax expense
The numerical reconciliation between the profit before taxation multiplied by the
Malaysian statutory income tax rate and the tax expense of the Fund is as follows:
01.10.2015
01.10.2014
to 31.03.2016 to 31.03.2015
RM
RM
Profit before taxation
Tax calculated at a tax rate of 24% (2015: 25%)
Tax effects of:
- Income not subject to tax
- Expenses not deductible for tax purposes
- Restriction on tax deductible expenses
for unit trust funds
Tax expense
2,558,860
════════
1,434,012
════════
614,126
358,503
(741,684)
14,230
(429,583)
5,940
113,328
────────
════════
65,140
────────
════════
44
44
12
MANAGEMENT EXPENSE RATIO (“MER”)
01.10.2015
01.10.2014
to 31.03.2016 to 31.03.2015
%
%
MER
1.01
═════
0.72
═════
Management expense ratio includes management fee, Trustee‟s fee, audit fee, tax
agent‟s fee and other administrative expenses which is calculated as follows:
MER =
A
B
C
D
E
F
=
=
=
=
=
=
(A + B + C + D + E) x 100
F
Management fee
Trustee‟s fee
Audit fee
Tax agent‟s fee
Other expenses
Average net asset value of the Fund for the financial period, calculated on
a daily basis
The average net asset value of the Fund for the financial period, calculated on a
daily basis is RM52,825,138 (31.03.2015: RM39,746,266).
13
PORTFOLIO TURNOVER RATIO
The portfolio turnover ratio for the financial
period (times)
01.10.2015
01.10.2014
to 31.03.2016 to 31.03.2015
0.21
═════
0.55
═════
The portfolio turnover ratio is derived from the following calculation:
(Total acquisition for the financial period + total disposal for the financial period) 2
Average net asset value of the Fund for the financial period calculated on a daily basis
where:
total acquisition for the financial period =RM14,694,440
(31.03.2015: RM24,178,250)
total disposal for the financial period = RM6,990,012
(31.03.2015: RM19,149,580)
45
45
14
UNITS HELD BY THE MANAGER AND PARTIES RELATED TO
THE MANAGER
The related parties and their relationship with the Fund are as follows:
Related parties
Relationship
RHB Asset Management Sdn Bhd
The Manager
RHB Investment Bank Bhd
Holding company of the Manager
RHB Capital Bhd
Ultimate holding company of the
Manager
RHB Islamic Bank Bhd
Related company of the Manager
The number of units held by the Manager is as follows:
31.03.2016
RM
30.09.2015
Units
RM
16,422 22,372
══════ ══════
17,151 22,246
══════ ══════
Units
The Manager
The units are held beneficially by the Manager for booking purposes and were
transacted at the prevailing market price.
Other than the above, there were no units held by Directors or parties related to
the Manager.
46
46
15
TRANSACTIONS BY THE FUND
Details of transactions with brokers and financial institutions by the Fund for the
financial period ended 31 March 2016 are as follows:
Percentage
Percentage
of total
Value of of total Brokerage brokerage
Broker/Financial institution trades
trades
fees
fees
RM
%
RM
%
Bank Muamalat Malaysia
Bhd
27,668,902
32.69
Public Islamic Bank Bhd 22,374,604
26.43
RHB Investment Bank Bhd* 12,648,188
14.94
Bank Islam Malaysia Bhd 12,548,016
14.82
Maybank Investment Bank
Bhd
7,629,000
9.01
Malayan Banking Bhd
1,060,610
1.25
Affin Hwang Investment
Bank Bhd
721,926
0.85
──────── ───── ───────
─────
84,651,246
100.00
════════ ═════ ═══════
═════
* Included in transactions by the Fund are trades with RHB Investment Bank
Bhd, the holding company of the Manager. The Manager is of the opinion that
all transactions with the related companies have been entered into in the normal
course of business at agreed terms between the related parties.
47
47
15
TRANSACTIONS BY THE FUND (CONTINUED)
Details of transactions with brokers and financial institutions by the Fund for the
financial year ended 30 September 2015 are as follows:
Percentage
Percentage
of total
Value of of total Brokerage brokerage
Broker/Financial institution trades
trades
fees
fees
RM
%
RM
%
RHB Islamic Bank Bhd*
Affin Hwang Investment
Bank Bhd
Bank Muamalat Malaysia
Bhd
CIMB Bank Bhd
RHB Investment Bank Bhd*
Hong Leong Investment
Bank Bhd
AmBank Bhd
Malayan Banking Bhd
Standard Chartered Bank
Malaysia Bhd
Bank Islam Malaysia Bhd
Maybank Investment Bank
Bhd
77,507,414
44.35
-
-
28,401,574
16.25
-
-
23,711,128
13,968,620
10,419,298
13.57
7.99
5.96
-
-
6,958,541
5,707,463
3,091,059
3.98
3.27
1.77
-
-
3,000,000
1,007,689
1.72
0.58
-
-
0.56
───── ───────
100.00
═════ ═══════
─────
═════
1,000,000
────────
174,772,786
════════
* Included in transactions by the Fund are trades with RHB Islamic Bank Bhd, a
related company of the Manager and RHB Investment Bank Bhd, the holding
company of the Manager. The Manager is of the opinion that all transactions
with the related companies have been entered into in the normal course of
business at agreed terms between the related parties.
48
48
16
SEGMENT INFORMATION
The Investment & Security Selection Committee of the Manager recommends
strategic resource allocations of the Fund to the Investment Committee of the
Manager (collectively referred to as "Committee"). The Investment Committee of
the Manager will then endorse the strategic decision recommended by the
Investment & Security Selection Committee for adoption on behalf of the Fund.
The operating segments are determined based on the recommendation by the
Investment & Security Selection Committee and reviewed by the Investment
Committee.
The internal reporting provided to the Committee for the Fund‟s assets, liabilities
and performance is prepared on a consistent basis with the measurement and
recognition principles of MFRS. The Committee is responsible for the Fund‟s
entire portfolio and considers the business to have a single operating segment
located in Malaysia. The Committee‟s asset allocation decisions are based on a
single, integrated investment strategy and the Fund‟s performance is evaluated on
an overall basis.
The reportable operating segments derive their income by seeking investments to
achieve targeted returns commensurate with an acceptable level of risk within each
portfolio. These returns consist of profit and gains on the appreciation in the value
of investments which is derived from unquoted fixed income securities in
Malaysia.
There were no changes in the reportable segments during the financial period.
49
49
STATEMENT BY MANAGER
We, Patrick Chin Yoke Chung and Dato‟ Othman bin Jusoh, two of the Directors
of RHB Asset Management Sdn Bhd, do hereby state that in the opinion of the
Directors of the Manager, the accompanying unaudited financial statements set
out on pages 12 to 49 are drawn up in accordance with the provisions of the
Deeds and give a true and fair view of the financial position of the Fund as of 31
March 2016 and of its financial performance and cash flows for the financial
period ended in accordance with Malaysian Financial Reporting Standards and
International Financial Reporting Standards.
On behalf of the Manager
PATRICK CHIN YOKE CHUNG
DIRECTOR
DATO‟ OTHMAN BIN JUSOH
DIRECTOR
Kuala Lumpur
17 May 2016
50
50
TRUSTEE‟S REPORT
We, CIMB Islamic Trustee Berhad (“the Trustee”), being the Trustee for RHB
Islamic Bond Fund (formerly known as RHB-OSK Islamic Bond Fund) (“the
Fund”), are of the opinion that RHB Asset Management Sdn Bhd (“the
Manager”), acting in the capacity as Manager of the Fund, has fulfilled its duties
in the following manner for the financial period ended 31 March 2016.
a) The Fund has been managed in accordance with the limitations imposed on
the investment powers of the Manager and the Trustee under the Deeds, the
Securities Commission Malaysia‟s Guidelines on Unit Trust Funds, the
Capital Markets and Services Act 2007 (as amended from time to time) and
other applicable laws;
b) Valuation/pricing of units of the Fund has been carried out in accordance with
the Deeds and relevant regulatory requirements; and
c) Creation and cancellation of units have been carried out in accordance with
the Deeds and relevant regulatory requirements.
For and on behalf of
CIMB Islamic Trustee Berhad (167913-M)
Lee Kooi Yoke
Chief Operating Officer
Kuala Lumpur
17 May 2016
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REPORT OF THE SHARIAH ADVISERS
We have acted as the Shariah Adviser of RHB Islamic Bond Fund (formerly
known as RHB-OSK Islamic Bond Fund) (“the Fund”). Our responsibility is to
ensure that the procedures and processes employed by RHB Asset Management
Sdn Bhd (“the Manager”) and that the provisions of the Deeds are in accordance
with Shariah principles.
In our opinion, the Manager has managed and administered the Fund in
accordance with Shariah principles and complied with the applicable guidelines,
rulings and decisions issued by the Securities Commission Malaysia pertaining to
Shariah matters for the financial period ended 31 March 2016.
I, Dr. Ghazali Jaapar, hereby confirm that all members of the Shariah Committee
have been consulted and made aware of all the Shariah issues in relation to this
report.
For RHB ISLAMIC BANK BHD
(Company No: 680329-V)
Dr. Ghazali Jaapar
Chairman
Shariah Committee of RHB Islamic Bank Berhad
Kuala Lumpur
17 May 2016
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CORPORATE INFORMATION
MANAGER
RHB ASSET MANAGEMENT SDN BHD
PRINCIPAL AND REGISTERED OFFICE
19th Floor, Plaza OSK, Jalan Ampang, 50450 Kuala Lumpur
BUSINESS OFFICE
5th Floor, Plaza OSK, Jalan Ampang, 50450 Kuala Lumpur
Email address: [email protected]
Tel: 03-2164 3036
Fax: 03-2164 4226
Website: http://www.rhbgroup.com
BOARD OF DIRECTORS
Mr Patrick Chin Yoke Chung (Independent Non-Executive Chairman)
Tuan Haji Khairuddin Ahmad (Senior Independent Non-Executive Director)
Dato‟ Othman Jusoh (Independent Non-Executive Director)
Encik Abdul Aziz Peru Mohamed (Independent Non-Executive Director)
Ms Ong Yin Suen (Non-Independent Managing Director)
Mr Chin Yoong Kheong (Independent Non-Executive Director)
(Appointed on 7 April 2015)
INVESTMENT COMMITTEE MEMBERS
Tuan Haji Khairuddin Ahmad (Independent Chairman)
Dato‟ Othman Jusoh (Independent Member)
Mr Lim Chee Sing (Non-Independent Member)
Ms Ong Yin Suen (Non-Independent Member)
CHIEF EXECUTIVE OFFICER
Mr Ho Seng Yee
SHARIAH ADVISORS
RHB Islamic Bank Berhad
SECRETARY
Encik Azman Shah Md Yaman (LS No. 0006901)
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BRANCH OFFICE
Kuala Lumpur Office
B-9-6, Megan Avenue 1
No. 189, Jalan Tun Razak
50400 Kuala Lumpur
Tel: 03-2171 2755 Fax: 03-2770 0022
Penang Office
64-D, Level 5, Lebuh Bishop
10200 Penang
Tel: 04-264 5639 / 04-263 4848
Fax: 04-264 5640 / 04-262 8844
Butterworth Office
2677, Jalan Chain Ferry
Taman Inderawasih
13600 Prai, Penang
Tel: 04-390 0022 Fax: 04-390 0023
Ipoh Office
4th Floor, 21-25
Jalan Seenivasagam, Greentown
30450 Ipoh, Perak
Tel: 05-242 4311 Fax: 05-242 4312
Johor Bahru Office
2nd Floor, 21 & 23
Jalan Molek 1/30, Taman Molek
81100 Johor Bahru, Johor
Tel: 07-358 3587 Fax: 07-358 3581
Kuantan Office
B 32-34, 2nd Floor, Lorong Tun Ismail 8
Sri Dagangan II
25000 Kuantan, Pahang
Tel: 09-517 3611 Fax: 09-517 3612
Kota Bharu Office
No 3953-H, 1st Floor
Jalan Kebun Sultan
15350 Kota Bharu, Kelantan
Tel: 09-741 8539 Fax: 09-741 8540
Kota Kinabalu Office
Lot No. C-02-04, 2nd Floor
Block C, Warisan Square
Jalan Tun Fuad Stephens
88000 Kota Kinabalu, Sabah
Tel: 088-628 686/692 Fax: 088-528 685
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Melaka Office
581B, Taman Melaka Raya
75000 Melaka
Tel: 06-284 4211 Fax: 06-292 2212
Batu Pahat Office
53, 53-A and 53-B Jalan Sultanah
83000 Batu Pahat, Johor
Tel: 07-438 0271 Fax: 07-438 0277
Miri Office
Lot 1268, First Floor
Centre Point Commercial Centre
Jalan Melayu
98000 Miri, Sarawak
Tel: 085-422 788 Fax: 085-415 243
Kuching Office
Lot 172, Section 49, K.T.L.D
Jalan Chan Chin Ann
93100 Kuching, Sarawak
Tel: 082-245 611 Fax: 082-242 712
TRUSTEE
CIMB Islamic Trustee Berhad
BANKER
RHB Bank Berhad
AUDITORS
PricewaterhouseCoopers
TAX ADVISER
PricewaterhouseCoopers Taxation Services Sdn Bhd
DISTRIBUTORS
Am Investment Bank Berhad
Areca Capital Sdn Berhad
CIMB Bank Berhad
CIMB Investment Bank Berhad
CIMB Islamic Bank Berhad
OCBC Al-Amin Bank (Malaysia) Berhad
OCBC Bank (Malaysia) Berhad
HSBC Amanah (Malaysia) Berhad
HSBC Bank (Malaysia) Berhad
iFast Capital Sdn Bhd
Phillip Mutual Berhad
RHB Bank Berhad
RHB Investment Bank Berhad
Standard Chartered Bank Malaysia Berhad
Standard Financial Services Sdn Berhad
United Overseas Bank (Malaysia) Berhad
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