Tabung Haji asset transfers the best option, minister says

PARLIAMENT | The government has decided that transferring Lembaga Tabung Haji's underperforming assets to a special purpose vehicle (SPV) is the best move for the fund's turnaround plan.

Two other options that were considered were for the government to act as a guarantor, or for it to provide a grant to Tabung Haji, de facto Religious Affairs Minister Mujahid Yusof Rawa told the Dewan Rakyat today.

"We wanted to avoid those (the two other options) as they would impact the country's financial position.

"Both these options are quite risky, so we took the best option to carve out the underperforming assets and care for the welfare of depositors," he said during question time.

Mujahid went on to give his assurance that Tabung Haji's main priority was to protect the interests of its depositors.

He said this in reply to Salim Sharif (BN-Jempol), who asked about the name of the new SPV, and whether the asset transfer would affect dividends issued to depositors.

The Prime Minister’s Department stated in a written reply issued last week that the assets were transferred to the SPV named Urusharta Jamaah Sdn Bhd (UJSB) at nearly double its book value of around RM10 billion.

Overall, Mujahid said, the transfer of RM19.9 billion of underperforming assets – comprising 29 real estate and 106 domestic security assets, as well as one non-listed company – had placed Tabung Haji's assets at RM76.5 billion against liabilities of RM75.5 billion as of last December.

The pilgrimage fund previously reported liabilities of RM74.4 billion against assets of RM70.3 billion, resulting in a total deficit of RM4.1 billion as of Dec 31, 2017.

To further questions on whether Tabung Haji could match the 6.5 percent dividend distributed last year, Mujahid said an announcement would be made at a later date.

The government had earlier revealed that the fund had been illegally paying dividendsto its depositors since 2014, despite its liabilities being more than its assets. - Mkini