5 kali BNM beri amaran, TH tetap bayar agihan tinggi

Bank Negara Malaysia (BNM) issued five warnings to the Hajj Endowment Fund (TH) between 2014 and 2020, cautioning the institution against paying high profit dividends that could jeopardize its financial standing. Prime Minister's Department Minister for Religious Affairs Zulkifli Hasan revealed that BNM had been particularly concerned about the impact of high dividend payouts on TH's dwindling reserves.

The minister explained that the situation posed a significant risk of TH's reserves becoming negative and exposed the institution to major problems if a large withdrawal occurred by depositors. He stated that BNM had sent five letters of warning to TH's chairman and the responsible minister, highlighting the gap between the organization's assets and liabilities.

The minister emphasized that these warnings were not ignored until TH's financial situation worsened, including a deficit in assets versus liabilities exceeding RM10 billion in the fourth quarter of 2018. He warned that if TH were to fail, the government would be liable for around RM74.5 billion due to the full guarantee of all deposits made to the institution.

Zulkifli also pointed to the National Audit Office's 2017 financial statement, which revealed that TH had manipulated financial standards to report higher profits for 2017. The appointment of a new TH auditor in 2018, who engaged PricewaterhouseCoopers (PwC) to reassess the institution's financial position and performance, confirmed that there were significant issues with the financial assessment, including a valuation of only RM556 million out of TH's RM4.6 billion assets by professional valuers.

The ministry's action was taken to allow TH to announce high dividend payouts despite its poor financial performance and insolvency. The minister noted that this decision was a clear violation as TH paid high dividends while the gap between assets and liabilities significantly violated the Hajj Endowment Fund Act. The RCI recommended radical reforms in governance, financial reporting, and investment management, with more than 75% of recommendations already implemented.

The Dewan Rakyat held a special session today to discuss the RCI's 211-page report published on July 29, which examined TH's management and operations from 2014 to 2020, including governance weaknesses, political interference, and excessive dividend payouts without accounting for the depreciation and reduction of investment values.