What was the net financial impact of the 2018 UJSB asset transfer?

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The 2018 UJSB asset transfer created an RM10.2 billion to RM10.9 billion accounting gap to maintain Tabung Haji's solvency.

The transfer of underperforming and non-core assets from Lembaga Tabung Haji (TH) to Urusharta Jamaah Sdn Bhd (UJSB) in 2018 involved a payment of approximately RM19.9 billion, comprising RM19.6 billion in sukuk and RM300 million in cash. However, the assets transferred were subsequently valued at a significantly lower range of RM9.7 billion to RM10 billion. This discrepancy between the payment made by UJSB and the actual valuation of the assets served as the immediate cost to keep TH solvent on paper at the time the accounting issues were identified.
UJSB's Financial Standing Post-Transfer

As of the end of 2024, UJSB's financial position remained challenging. The entity reported total assets of approximately RM11.44 billion against total liabilities of roughly RM23.86 billion. This substantial liabilities-to-assets ratio indicates that UJSB was still contending with the financial implications of the inherited portfolio.
Accumulated Losses Despite Profitability

Despite experiencing a profitable year in 2024, UJSB had accumulated significant losses amounting to approximately RM12.42 billion. This situation highlights that even a single year of positive performance was insufficient to offset the substantial accumulated deficits incurred since its establishment.
The Purpose of the Valuation Gap

The difference between the RM19.9 billion paid by UJSB and the RM9.7 billion to RM10 billion valuation of the transferred assets was a critical accounting measure. This gap effectively represented the immediate financial burden absorbed to ensure that TH's balance sheet appeared solvent when the accounting problems first came to light, thereby preventing a breach of the Tabung Haji Act 1995 and enabling continued dividend payouts.

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What was the net financial impact of the 2018 UJSB asset transfer?

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