LPI Capital Bhd : Annual General Meeting 2022

LPI CAPITAL BHD 196201000175 (4688-D)

(Incorporated in Malaysia)

Minutes of the 61st Annual General Meeting (AGM) conducted as a virtual AGM at the Broadcast Venue at 29th Floor, Menara Public Bank, 146 Jalan Ampang, 50450 Kuala Lumpur, Malaysia on Wednesday, 6 April 2022 at 11.00 a.m.

PRESENT AT BROADCAST VENUE :

DIRECTORS

Mr Tee Choon Yeow - Chairman of Meeting (Independent Non-Executive Co-Chairman)

Mr Tan Kok Guan

(Executive Director/ Chief Executive Officer)

IN ATTENDANCE

Ms Kong Thian Mee (Company Secretary)

PARTICIPATED REMOTELY :

DIRECTORS

Tan Sri Dato' Sri Dr. Teh Hong Piow (Non-Independent Non-Executive Chairman)

Mr Lee Chin Guan

(Independent Non-Executive Director)

Mr Quah Poh Keat

(Non-Independent Non-Executive Director)

Ms Chan Kwai Hoe

(Independent Non-Executive Director)

Ms Soo Chow Lai

(Independent Non-Executive Director)

Dato' Chia Lee Kee

(Independent Non-Executive Director)

SHAREHOLDERS AND PROXIES As per login to Tiih Online

BY INVITATION - AUDITORS Mr Ooi Eng Siong

Ms Lee Yeit Yeen

(External Auditors, Messrs KPMG PLT)

WELCOME ADDRESS

On behalf of the Board, Mr Tee Choon Yeow, the Chairman of Meeting welcomed all the participants to the Meeting.

INTRODUCTION

The Chairman of Meeting informed the Meeting of the following :-

• (i) To ensure the safety of LPI's shareholders due to Covid-19 pandemic, the Board had resolved that the 61st AGM of the Company be convened as a virtual meeting, and be carried out in the manner as guided by the Securities Commission Malaysia Guidance on the Conduct of General Meetings for Listed Issuers revised on 16 July 2021 and the Companies Act 2016.

• (ii) Shareholders and proxies were not allowed to be physically present as the 61st AGM was held as a virtual meeting. Instead, shareholders and proxies participated remotely by using the Remote Participation and Voting (RPV) facilities.

• (iii) This AGM was conducted with only the essential individuals present at the broadcast venue.

The Chairman of Meeting introduced himself and those who were present at the broadcast venue, namely the Executive Director cum Chief Executive Officer (CEO), Mr Tan Kok Guan, and the Company Secretary, Ms Kong Thian Mee. He further introduced the following Directors who had participated in the AGM remotely :-

• (i) Tan Sri Dato' Sri Dr. Teh Hong Piow - Non-Independent Non-Executive Chairman

• (ii) Mr Lee Chin Guan - Independent Non-Executive Director

• (iii) Mr Quah Poh Keat - Non-Independent Non-Executive Director

• (iv) Ms Chan Kwai Hoe - Independent Non-Executive Director

• (v) Ms Soo Chow Lai - Independent Non-Executive Director

• (vi) Dato' Chia Lee Kee - Independent Non-Executive Director

REMOTE PARTICIPATION AND VOTING PROCEDURE (RPV)

The Chairman of Meeting explained that pursuant to Paragraph 8.29A(1) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the Company must ensure that all resolutions set out in the Notice of the 61st AGM be voted by poll.

The Chairman of Meeting further informed that the Company had appointed the Share Registrar, Tricor Investor & Issuing House Services Sdn Bhd (Tricor), as Poll Administrator to conduct the online remote voting, while Deloitte Business Advisory Sdn Bhd (Deloitte) had been appointed as Scrutineers to validate the votes cast at the 61st AGM.

The online remote voting for the resolutions had commenced at the beginning of the Meeting.

The RPV procedure was briefed by Tricor.

QUORUM

A total of 695 shareholders and proxies had participated in the Meeting. There being quorum, the Meeting was called to order at 11.00 a.m. by the Chairman of Meeting.

NOTICE OF MEETING

In following the Best Practice(s) of the Malaysian Code on Corporate Governance by Securities Commission, the Company had given the Notice of the Company's 61st AGM to shareholders at least 28 days prior to the date of the AGM. The notice convening the Meeting, having been circulated to all the members of the Company well within the regulatory requirements, was taken as read.

ORDINARY BUSINESS

AUDITED FINANCIAL STATEMENTS

AND REPORTS OF DIRECTORS AND AUDITORS

The Audited Financial Statements of the Company and the Group for the financial year ended 31st December 2021 and the Reports of the Directors and Auditors having been despatched to shareholders in accordance with the Company's Constitution and Bursa Malaysia Listing Requirements, were laid before the

Meeting.

Shareholders' approval was not required for the Audited Financial Statements pursuant to Sections 248(2) and 340(1)(a) of the Companies Act 2016. Hence, this matter was not put for voting.

The Chairman of Meeting invited Mr Tan Kok Guan (Mr Tan KG), the Executive Director cum CEO to present the LPI Group's performance in 2021 to

shareholders, which was reflected as below :-

Financial Performance

2021 was another challenging year for Malaysia as the COVID-19 pandemic continued to cause disruptions in many aspects of daily life. The economic recovery fell short of expectations due to the emergence of new variants and implementation of lockdowns. There was also serious flooding in the month of

December triggered by the year-end monsoon that affected many states in Malaysia.

Despite the various challenges encountered, triggered mainly by the prolonged pandemic, the LPI Group remained resilient and continued to report satisfactory performance in financial year 2021.

For the 12 months ended 31 December 2021, LPI registered a 5.9% increase in its

Revenue to RM1.72 billion from RM1.62 billion achieved in financial year 2020, mainly due to higher Gross Earned Premium which contributed 93.8% to the total operating revenue in 2021.

The LPI Group managed to report a marginal 0.9% improvement in its Profit Before Tax to RM437.3 million from RM433.6 million registered in financial year

2020. Net Profit Attributable to Shareholders increased by 2.4% to RM344.7 million from RM336.7 million.

For financial year 2021, LPI's Net Return in Equity was reported at 16.1%, marginally lower than 16.2% reported in 2020. Its Earnings Per Share for the year under review, however, improved to 86.52 sen from 84.52 sen.

Lonpac Insurance Bhd, the wholly-owned insurance subsidiary of LPI, reported a 4.9% lower Profit Before Tax of RM397.0 million as compared against RM417.6 million achieved in financial year 2020. The lower profitability of Lonpac was mainly due to the poor performance of its Fixed Income Unit Trusts Investment as the increase in bond yields during the year had lowered the valuation of the unit trust investment. In 2021, Lonpac booked in Net Fair Value Loss of RM46.1 million for its investment as compared to Net Fair Value Gain of RM1.5 million reported in 2020.

However, Lonpac registered a strong underwriting performance, especially in the first three Quarters of the year mainly due to lower claims incurred. The improved claims experience was due to the implementation of various levels of Movement Control Order (MCO) during the year which resulted in reduced social and economic activities. Its Claims Incurred Ratio for the financial year 2021 registered a lower 36.5% as compared to 41.2% reported in 2020.

With Management Expenses Ratio at 19.8% and Commission Ratio at 6.1% of net earned premium, Lonpac reported an impressive Combined Ratio of 62.5% for Financial year 2021 as compared to 66.6% achieved in 2020. As a result, the Underwriting Profit of Lonpac improved by 12.0% to record RM379.7 million from RM338.9 million registered in 2020.

Despite facing operational challenges during the year arising from movement restrictions under various stages of MCOs, Lonpac had sustained its business portfolio and registered a marginal 0.7% increase in its Gross Written Premium to RM1.56 billion from RM1.55 billion reported in 2020. In comparison, the Malaysian General Insurance Industry reported a growth of 2.7% in gross written premium in 2021.

Fire Insurance remained the core portfolio of business of Lonpac contributing 40.4% of its total Gross Written Premiums while Motor Insurance contributed 22.9%, Miscellaneous class of insurance 30.6% and Marine & Aviation 6.1%. All major classes of insurance continued to register healthy claims ratios with Fire Insurance maintaining the biggest contributor to Lonpac's underwriting profit.