Will depositors be affected by the asset transfer to the SPV?

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Depositors Will Not Be Directly Affected by the Asset Transfer

Depositors' funds are not directly impacted by the asset transfer to the special purpose vehicle (SPV) as the government's restructuring plan has successfully restored Lembaga Tabung Haji's (LTH) financial health. The move to an SPV was specifically designed to prevent the need for government guarantees or direct financial injections into LTH, thereby safeguarding depositors.
Financial Health Restored Through Asset Restructuring

In December 2018, LTH's financial standing saw a significant improvement, with assets reaching RM76.5 billion against liabilities and deposits totalling RM75.5 billion. This turnaround was achieved through the creation of an SPV, which acquired underperforming properties and equities from LTH. This strategic move effectively addressed a previous deficit where liabilities had exceeded assets by RM4.1 billion in December of the same year.
SPV Mechanism Avoids Government Financial Intervention

The selection of a special purpose vehicle (SPV) for this restructuring was a deliberate choice to circumvent the necessity for the government to provide a guarantee or inject funds into LTH. The SPV facilitated the transfer of problematic assets, allowing LTH to present a healthier financial statement. This approach ensured that the burden of the restructuring did not fall directly on government finances.
Dividend Payments to Resume Following Financial Recovery

The previous deficit meant that LTH was prohibited by the Tabung Haji Act 1995 from paying dividends, or hibah, as it had no distributable profits. However, with the successful recovery plan and the improved financial position, LTH is now in a state to resume dividend payments. This indicates a positive outcome for depositors who had been awaiting these distributions.

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Will depositors be affected by the asset transfer to the SPV?

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