KENANGA ANNUAL REPORT 2020

182 5 1 2 3 4 6 7 FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS 31 December 2020 9. LOANS, ADVANCES AND FINANCING (CONT’D.) 9.2 Impairment allowance for loans, advances and financing are as follows: (a) Term loans and subordinated term loan The tables below show the credit quality and the maximum exposure to credit risk based on the Group’s and the Bank’s internal credit rating system and year-end stage classification. The amounts presented are gross of ECL allowances. Details of the Group’s and the Bank’s internal rating system are explained in Note 50(a). 2020 Group Internal rating grade Stage 1 RM’000 Stage 2 RM’000 Stage 3 RM’000 Total RM’000 Performing: Strong - - - - Satisfactory 451,490 - - 451,490 Substandard 48,395 87,908 - 136,303 Total 499,885 87,908 - 587,793 2019 Group Internal rating grade Stage 1 RM’000 Stage 2 RM’000 Stage 3 RM’000 Total RM’000 Performing: Strong 3,840 - - 3,840 Satisfactory 426,008 36,347 - 462,355 Substandard 192,681 6,447 - 665,323 Total 622,529 42,794 - 665,323 2020 Bank Internal rating grade Stage 1 RM’000 Stage 2 RM’000 Stage 3 RM’000 Total RM’000 Performing: Strong - - - - Satisfactory 524,484 - - 524,484 Substandard 48,395 87,908 - 136,303 Total 572,879 87,908 - 660,787