Bank Negara issues statement on Tabung Haji

Bank Negara Malaysia stressed that Lembaga Tabung Haji (TH) “has proactively taken appropriate measures to further strengthen its risk management practices, both on its own initiative and in response to earlier engagements with the Bank.”

It stated in a statement today that while TH “is not under the direct supervision of the Bank, advisories issued by the Bank to non-bank financial institutions are aimed at ensuring the institutions will continue to be well managed and effectively perform the role for which they have been established.”

This, according to the central bank will contribute to the financial stability and reinforce a sustainable and healthy financial position of the institution going forward.

Bank Negara in the same statement stated that it undertakes surveillance on significant non-bank financial institutions that have important interlinkages with the financial system.

In the same statement the central bank said that this is part of its mandate to promote financial stability.

The central bank added that the mandate is supported by the establishment of the Financial Stability Executive Committee (FSEC) under the Central Bank of Malaysia Act 2009.

FSEC is chaired by the Governor and members include the Secretary General of the Treasury, the Chairman of the Malaysia Securities Commission, the Chief Executive Officer of the Malaysia Deposit Insurance Corporation and an independent external member.

The central bank issued the statement following the leaked letter allegedly from the central bank to Tabung Haji, warning the institution of the state of its reserves.

Meanwhile, according The Malaysian Insider, Tabung Haji chariman, Datuk Abdul Azeez Abdul Rahim denied that the fund’s reserves were in the red and announced that a press conference will be held by Tabung Haji to explain on the matter.