What triggered the RM6 billion net withdrawals from Tabung Haji in early 2019?

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The announcement of a 1.25 per cent hibah for 2018 triggered net withdrawals of RM6 billion from Tabung Haji in early 2019.

A significant panic withdrawal from Tabung Haji occurred in early 2019, resulting in net withdrawals amounting to RM6 billion within a short timeframe. This event was directly precipitated by the announcement of a 1.25 per cent hibah (dividend) for the financial year 2018.
Hibah Announcement as a Catalyst

The declaration of a 1.25 per cent hibah for the year 2018 in early 2019 served as the immediate trigger for the substantial outflow of funds. This rate of return was perceived by depositors, leading to a rapid withdrawal of savings.
Scale of Withdrawals

The period following the hibah announcement saw a "panic withdrawal" event, characterised by a net outflow of RM6 billion from Tabung Haji's accounts. This scale of withdrawal within a compressed period highlighted a loss of confidence among depositors.
Underlying Financial Concerns

This outflow occurred against a backdrop where Tabung Haji was technically insolvent, necessitating a government rescue and restructuring plan. The announcement of a low hibah rate in such circumstances likely exacerbated existing concerns about the institution's financial health, prompting depositors to withdraw their savings.

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What triggered the RM6 billion net withdrawals from Tabung Haji in early 2019?

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