KENANGA ANNUAL REPORT 2018

NOTES TO THE FINANCIAL STATEMENTS 31 December 2018 203 ANNUAL REPORT 2018 28. RESERVES Group Bank 2018 2017 2018 2017 Note RM’000 RM’000 RM’000 RM’000 Non-distributable: Capital reserve 88,938 88,938 153,863 153,863 Fair value reserve (a) (4,120) (6,629) 2,175 (4,840) Exchange reserve (b) 18,783 17,398 - - Regulatory reserve (c) 25,488 25,277 25,488 25,277 ESS reserve 2,588 - 2,588 - 131,677 124,984 184,114 174,300 Retained profits 509,888 520,345 513,675 513,726 641,565 645,329 697,789 688,026 The nature and purpose of each category of reserves are as follows: (a) Fair value reserve is in respect of unrealised fair value gains and losses on financial investments at FVOCI, net of tax. (b) The exchange reserve represents foreign exchange differences arising from the translation of the financial statements of the associated company. (c) Regulatory reserve is maintained in addition to the impairment allowance for non-impaired credit exposures that has been assessed and recognised in accordance with MFRS in compliance with BNM requirements. 29. OPERATING REVENUE Revenue of the Bank comprises all types of revenue derived from brokerage, lending, treasury, investment and trading and other banking activities undertaken by the Bank. Revenue of the Group comprises all types of revenue derived from brokerage, lending, treasury, investment, trading and investment management and other banking activities undertaken by the Group.