Page 41 - Agib Bank Limited Annual Report 2021

4.21 Earnings per share This depends mainly on the Risk Management
framework set out by the Central Bank. Bank
The bank presents basic and diluted earnings specific framework based on the overall structure
per share (EPS) data for its ordinary shares. of the Bank ensures that the Board of Directors
Basic EPS is calculated by dividing the profit or has overall responsibility for the establishment
loss attributable to ordinary shareholders of the and oversight of the Bank’s risk management
bank by the weighted average number of framework. The Board has established the Asset
ordinary shares outstanding during the period. and Liability (ALCO), Credit and Operational Risk
Diluted EPS is determined by adjusting the profit committees, which are responsible for developing
or loss attributable to ordinary shareholders and and monitoring risk management policies in their
the weighted average number of ordinary specified areas. All Board committees have both
shares outstanding for the effects of all dilutive executive and non-executive members and report
potential ordinary shares.
regularly to the Board of Directors on their
activities.
4.22 Dividends
Dividends are recognised as a liability in the The Bank’s risk management policies are
period in which they are declared. established to identify and analyse the risks faced
by the Bank, to set appropriate risk limits and
controls, and to monitor risks and adherence to
4.23 Sukuk Al Salam
limits. Risk management policies and systems are
Securities purchased from the Central Bank of reviewed regularly to reflect changes in market
The Gambia under agreement to resell (reverse conditions, products and services offered. The
Repos), are disclosed as Sukuk al Salam as bank, through its training and management
they are held to maturity after which they are standards and procedures, aims to develop a
repurchased and are not negotiable or disciplined and constructive control environment,
discounted during the tenure. in which all employees understand their roles and
obligations.

4.24 Acceptances and letters of credit
The Bank’s Audit Committee is responsible for
Acceptances and Letters of credits are monitoring compliance with the Bank’s risk
considered contingent liabilities and are management policies and procedures, and for
disclosed unless the possibility of an outflow of reviewing the adequacy of the risk management
resources involving economic benefits is framework in relation to the risks faced by the
remote. Bank. The Bank’s Audit Committee is assisted in
these functions by Internal Audit. Internal Audit
5 Financial risk management undertakes both regular and ad-hoc reviews of
risk management controls and procedures, the

Introduction and overview results of which are reported to the Audit
The Bank has exposure to the following risks Committee.
arising from the use of financial instruments.
Typical of such risks are as follows: (i) Credit risk

credit risk Credit risk is the risk that a customer or
liquidity risk counterparty will default on its contractual
market risk obligations resulting in financial loss to the Bank.
operational risk. The Bank’s main income generating activity is
lending to customers and therefore credit risk is a
These are principal risks of the Bank. This note principal risk. Credit risk mainly arises from loans
presents information about the Bank exposure to and advances to customers and other banks
these risks, including the objectives, policies and (including related commitments to lend such as
processes for measuring and managing the risks loan or credit card facilities), investments in debt Annual Report and IFRS Financial Statements
as well as their impact on earnings and capital. securities and derivatives that are an asset
position.
Risk management framework

Agib Bank Annual Report 2021 www.agib.gm 41