What was the financial state of Tabung Haji prior to the 2019 restructuring?

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Tabung Haji Faced Insolvency and Significant Withdrawal Risks Before 2019 Restructuring

Prior to the 2019 restructuring, Tabung Haji (TH) was technically insolvent and faced the potential for substantial government liabilities due to a significant risk of panic withdrawals. In 2018, the government's potential exposure from such a scenario was estimated at approximately RM74.5 billion. This risk materialised in 2019 when a panic withdrawal occurred, leading to net withdrawals of RM6 billion within a brief period, following the announcement of a 1.25 per cent hibah for 2018.
Pre-Restructuring Insolvency

Technically, Tabung Haji was in an insolvent state before the restructuring efforts were undertaken. This meant that its liabilities exceeded its assets, rendering it unable to meet its financial obligations without external intervention. The institution required a rescue to stabilise its financial position and ensure its long-term viability.
RM74.5 Billion Potential Government Liability

The government stood to assume liabilities amounting to approximately RM74.5 billion in the event of a massive panic withdrawal in 2018. This figure highlights the scale of the financial risk posed to the nation's coffers had a large-scale withdrawal by depositors occurred. Such a scenario would have placed an immense burden on government finances.
2019 Panic Withdrawal Event

A panic withdrawal did indeed take place in 2019, resulting in net withdrawals of RM6 billion over a short duration. This event was directly linked to the announcement of a 1.25 per cent hibah (dividend) for the financial year 2018, which was made in early 2019. The declaration of hibah, in the context of the institution's underlying financial health, appears to have triggered deposit outflows.

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What was the financial state of Tabung Haji prior to the 2019 restructuring?

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