KUALA LUMPUR — Dec. 12, 2018: Tabung Haji is looking to put a cap on each depositor’s fund as a measure to reduce the government’s liability and exposure towards depositors and forms a part of the agency’s business restructuring plan awaiting board approval.
Depositors’ fund is guaranteed by the government, whereby the government has to pay in full should anything happen, unlike banking institutions that only have to pay a maximum of RM250,000 through the Malaysian Deposit Insurance Corporation to a depositor no matter how much he has put in.
However Tabung Haji’s group managing director and chief executive Datuk Seri Zukri Samat told Bernama today that the plan would not be executed yet as the board was handling some issues relating to panic withdrawals by depositors, triggered by what he claimed to be recent misreporting on the agency’s financial situation.
Zukri noted that withdrawals went above normal yesterday, blaming it on a news report.
The TH recovery and restructuring working plan unveiled in Parliament recently showed a high concentration of deposits among a small segment, whereby 1.3 per cent or 117,000 depositors contributed of the total, while a single depositor had more than RM190 million.
Zukri hoped that the restructuring would return the fund to its original objective.
“We want to go back to our original mandate. We are reviewing our business model, which includes exiting our investments in some sectors which are not giving us positive returns.
“We have started the review but we have not yet actually gone to the board for endorsement. We know the sectors we want to exit,” he explained.
Zukri lauded the move to put TH under the central bank’s supervision from this January because BNM has a very robust risk management and liquidity framework.