No real weighted woes in TH

The Minister in charge of Religious Affairs Dato’ Seri Mujahid Yusof ought to be treating the facts pertaining Tabung Haji (TH) wholesomely accurate and without political overtone, because a lot is at stake here.

In a ‘shock and awe’ revelation made at Parliament this morning, Mujahid blamed TH for its Hibah exercise which he malignantly described as, “Illegal”.

The Star story:

Mujahid: Tabung Haji paid dividends illegally since 2014 as debts exceeded assets


KUALA LUMPUR: Lembaga Tabung Haji (TH) has been illegally paying dividends (hibah) to its depositors since 2014, says Datuk Seri Dr Mujahid Yusof Rawa.

The Minister in charge of Islamic affairs explained that the dividend payments had contravened the Tabung Haji Act 1995 as TH had more debts than assets in the previous years.

He cited TH’s 2017 financial report, tabled in Parliament on Monday (Dec 10), which showed that it has more liabilities (RM74.4bil) than its total assets (RM70.3bil).

This meant a total deficit of RM4.1bil as of Dec 31, 2017. 

First, its assets cannot be less than its debts and second, there must be profits to be distributed. 

“TH has been declaring hibah since 2014, not in accordance with the Act, because its assets have been less than its liabilities,” he told reporters during a press conference in Parliament on Monday (Dec 10). 

TH’s 2017 financial report, audited by PricewaterhouseCoopers (PwC), had recommended the Government initiate a “comprehensive turnaround plan” to address the RM4.1bil gap, said Dr Mujahid. 

Under the plan, Dr Mujahid said PwC had proposed setting up a special purpose vehicle (SPV) to take over, rehabilitate and maximise the recovery of its underperforming assets. 

He added that the SPV has been approved by Cabinet and it will be in operation before the end of 2018. 

Dr Mujahid said that TH will be placed under the supervision of Bank Negara Malaysia (BNM) on Jan 1, 2019, and expressed confidence that the turnaround plan will be implemented by the government as soon as possible

“Cabinet had discussed the turnaround plan thoroughly and given our full support and endorsement to the plan, so that TH’s financial position can be regularised and the people’s confidence can be restored. 

“To ensure the long-term sustainability and resilience of TH, the government has decided to place it under the supervision of BNM administratively, from Jan 1, 2019.” 

Meanwhile, Dr Mujahid also said depositors may receive their dividend payouts for 2018. 

“Now that the restructuring plan is here, if we can fulfil two conditions and if there is profit, then definitely we will get (dividends). 

“But that will be announced before the end of the year, we have not close out accounts for the year yet.” 

Dr Mujahid also hinted that further action may be taken against the previous administration of TH. 

“Since 2014, TH has been giving dividends without fulfilling the two conditions. So, where did they get the money? I leave that to you,” he said. 

“That will be dealt with later,” he added.

************

The announcement by Minister Mujahid is a politically very hazardous.

What is interesting in Minister Mujahid’s statement that no mention of the the clear policies of how TH’s treatment of assets, borrowings, added value or impairment of losses and investments.

Clearly, how then Auditor General Tan Sri Ambrin Buang signed off the audited accounts.

The fact is that TH is not facing not had faced liquidity and cashflow issues, troubled borrowings and in the exact line to explain 1MDB commercial issues, “Mismatch between assets, borrowings and cashflow management”.

Two Fridays ago it was revealed that TH made two Police reports against previous TH Chairman, Group Managing Director, CEO and several current key management personalities.

What is interesting is that they are pertaining to Yayasan Tabung Haji activities “inclined to be political” last year and a corporate exercise of disposal of subsidiary and assets of plantations in Indonesia, six years ago.

Were there red flags raised by then the Auditor General?

Another interesting fact is about TH’s holdings and investments in Bank Islam Malaysia Bhd (BIMB).

TH de-invested most of it’s holdings in BIMB throughout 2016 and 2017 and obtained a premium, which very positive to TH’s balance sheet and directly, the 9.7 million depositors.

That’s comparatively to present capital and financial market level and performance.

TH maintained operations for the benefit of depositors and aspiring Hajj pilgrims all over the country, on top a globally Hajj operations in Saudi, year-on-year, which what it was formed to do.

This is a point which Minister Mujahid should continuously stress on instead of making ‘shock and awe’ announcements, which is political in nature and would confuse TH depositors and aspiring Hajj pilgrims more and provide comfort for their savings.

The fact that exactly week ago, a foreign news carried a malignant media story to hit at TH, added to the political overtone of Pakatan Harapan leaders pawning TH at an effect with the expense of TH depositors and aspiring Hajj pilgrims.

What is interesting is the Malay-Muslim confidence of the Pakatan Harapan leadership in the Federal and State Governments, all and in sundry, is on the eroding and bearish trend.

More so in the recently concluded successful highly peaceful and incident free rally of 300,000 Malay-Muslim that send a thunderous message that their interest cannot be taken lightly or at their expense.

Minister Mujahid should strive to preserve the 9.7million confidence with uplifting developments in TH instead of using it for politics and at the expense of the too many simpletons who saved in TH and aspire to fulfil the fifth tenet of Islam.

Majority of those who saved in TH are not analytical enough to understand the corporate decisions made by professionals, to preserve the strategic interest in TH’s investments, which is to extend and strive for better benefits to more the 9.7million depositors and on record the over a million Hajj pilgrim aspirants.

The horror past ghost in making malicious political revelation at the expense of TH caused a few thousand to lose their assigned queue for Hajj, by closing their accounts due to a media shock started by a blogger. This happened a three and half years ago.

Minister Mujahid also announced the creation of a special purpose vehicle (SPV) to sort out TH financial and commercial woes is also to politicise and cast the aspersions that TH is heading into a deep financial crisis, which is heading the receivership and administration destination.

Obviously, some quarters would commercially benefit from the corporate exercises which would be undertaken by such SPVs.

On top of that to announce that Bank Negara Malaysia would be the governing authority over TH is to politically demonise the current corporate governance of TH which include the Auditor General and all the acts and authoritative bodies are incompetent or inadequate.

Minister Mujahid should call for the extensive due diligence and quicken the Police investigations on TH, instead adding into the political overtone.

In the final analysis, political overtone outweighing the strategic interest of the simpleton amongst rural and lifetime savers of TH, is a road for calamity of the majority Malay-Muslim, way pass the political lifespan of the current leaders in power.

The institutional credibility and integrity of TH should never in anyway be the pawn of political masters.

Published in: on December 10, 2018 at 15:00  Leave a Comment  

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