1 |
Why is the TH Profit Distribution announcement made a little late compared to last year |
- The announcement of the distribution of profits from 2022 was made after the performance and financial position of TH had been audited at the beginning of the second quarter of the year.
- Previously, the announcement of Profit Distribution was carried out in the first quarter of the year based on performance and initial financial position before the audit was completed.
- This decision takes into account recommendations for improvement following earlier recommendations by the Royal Commission of Inquiry (RCI).
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2 |
What is the rate and amount of Profit Distribution for Financial Year 2022? |
- Profit Distribution for Financial Year 2022 remains at the rate of 3.10% after zakat of 2.57% is handled on behalf of depositors.
- The Profit Distribution for the Financial Year 2022 is higher compared to the average fixed deposit rate of Islamic banking for a period of 12 months, which is 2.34%.
- The Profit Distribution for Financial Year 2022 involves an amount of RM2.65 billion and is benefitting more than 8.7 million TH depositors.
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3 |
How to calculate the Profit Distribution for Financial Year 2022? |
- The calculation for Profit Distribution for Financial Year 2022 is the same as last year, which is based on the average minimum monthly balance saved throughout the year.
- The detailed calculation formula for the Annual Distribution is as follows:
- Average Monthly Lowest Savings Balance x 3.10% = (Lowest monthly savings balance from January –December 2022 / Number of Months) x 3.10%
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4 |
Who is eligible to receive the Profit Distribution for Financial Year 2022? |
- Eligible depositors who:
- Has an active account on December 31, 2022 and remains active on the date the Profit Distribution is credited; and
- Opened an account on or before December 5, 2022.
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5 |
Who is not eligible to receive Profit Distribution for Financial Year 2022? |
- Ineligible depositors are:
- Depositors with inactive and dormant accounts, i.e. depositor accounts that have not made any transactions for more than seven consecutive years;
- Depositors with accounts closed before the date of Profit Distribution; and
- Depositors with accounts opened after December 5, 2022 (less than one full month).
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6 |
How are Profit Distributions paid to depositors? |
- Profit Distributions will be credited directly into the depositor's account that is still active and eligible to receive profit distribution.
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7 |
When can the Profit Distribution for Financial Year 2022 be reviewed by depositors? |
- Total profit distribution and the latest balance can be checked from 12:00 noon, on Saturday, April 29, 2023 via:
- TH branch counters
- Branch counters of TH's strategic partner banks, i.e. Bank Islam and Bank Rakyat
- THiJARI platform
- The electronic channels of TH's strategic partner banks, i.e. Bank Islam, Bank Rakyat, Maybank Islamic, CIMB Islamic and AmBank Islamic.
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8 |
Do depositors still have to pay zakat on savings in TH? |
- Profit Distribution for the Financial Year 2022 is distributed after zakat is handled on behalf of the depositor.
- TH depositors no longer need to pay zakat on savings and profit distribution received.
- TH paid zakat on behalf of the depositor in accordance with the decision of the 17th Fatwa Committee Conference of the National Council for Malaysian Islamic Religious Affairs on May 3rd, 1979.
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9 |
What is the total amount of zakat TH has paid off on behalf of the depositors? |
- TH allocated a sum of RM97 million for zakat for the year 2022 which will be paid in full to all State Islamic Religious Councils on behalf of depositors.
- Payment of zakat to the State Islamic Religious Council is based on the depositor's savings balance ratio by state.
- To date, TH has paid an accumulated RM1.27 billion for zakat.
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10 |
Does TH issue a receipt for the depositor's zakat payment? |
- TH pays zakat on behalf of the depositors based on the legal approach of khultoh which is mixed property.
- The type of zakat paid is business zakat and not savings zakat because the depositors have appointed TH to manage the investments of the depositors’ savings fund.
- Hence, zakat receipts will not be issued.
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11 |
How is the performance and financial position for 2022? |
- TH's investment income remains resilient despite a challenging economy and volatile market. Expense management was successfully managed even in the face of inflationary pressure.
- TH has recorded a gross income of RM 3.85 billion for 2022 compared to RM 3.72 billion for 2021.
- TH's financial position continues to remain positive with assets totaling RM 90.92 billion exceeding liabilities, where depositors' savings being the largest component of TH's liabilities amounting to RM 87.60 billion.
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12 |
Will TH's financial performance be affected by the economic and market conditions in 2022? |
- The investment environment in 2022 is very challenging for all investment institutions, including TH.
- The domestic and global stock market was affected by more than 10%, the capital market (sukuk) was also affected by the aggressive increase in financing rates.
- Profit Distribution and Hajj Financial Assistance are closely related because they come from the same source of income. If Hajj Financial Assistance given is high, it will then also affect the rate of Profit Distribution to depositors. Since 2001, TH has borne Hajj Financial Assistance as part of the expenditure of RM2.23 billion.
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13 |
What efforts have been implemented by TH in the challenging economic conditions in 2022? |
- All investment institutions including TH had to face market uncertainty throughout 2022.
- TH has taken a more cautious investment approach based on strategic asset allocation to face the uncertain environment.
- Despite facing inflationary pressure, TH has managed to control other expenses with total operating expenses decreasing by 3% compared to 2021.
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14 |
Why does TH's Hajj Financial Assistance have an impact on Profit Distribution? |
- Hajj Financial Assistance increases every year due to cost increases which are beyond TH's control, especially in the Holy Land.
- The cost of performing Hajj has increased by 25 percent to RM28,632 per person for the 2022 Hajj Season compared to RM22,900 in 2019. This Hajj cost increase has caused the Hajj Financial Assistance to increase to 55 - 65 percent for each Muassasah pilgrim.
- Beginning 2022, TH has introduced Hajj Financial Assistance in a targeted manner, taking into account the ability of each pilgrim and the sustainability of the country's Hajj institutions to bear the financial burden.
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15 |
How is the 2022 Profit Distribution Rate compared with profit distributions of other funds/institutions? |
- TH was established to help Muslims save money to perform Hajj. This goal affects how TH formulates investment strategies, the level of risk and the level of liquidity that will determine the rate of return obtained.
- Other investment institutions have their own goals and this will lead them to have different investment strategies, risk levels and liquidity levels as well.
- This means that TH's Profit Distribution Rate cannot be fairly compared with other investment institutions due to the different establishment purposes.
- In addition, savings in TH remain safe because they are fully guaranteed (with no amount limit) by the Government as stipulated in the Hajj Savings Act 1995, and zakat has been paid on behalf of the depositor, where these advantages are not available in other funds/institutions.
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16 |
What if we compare TH Profit Distribution to Islamic banking fixed deposits and Islamic banking savings deposits for a period of 12 months? |
- The inflow and outflow of account savings in TH is on demand, without any limits and can be done through various online banking platforms.
- This shows that account savings in TH are like Islamic banking savings deposits where they are very different when compared to other investments such as Islamic banking fixed deposits, investments in cooperatives, investments in trust funds and investments for retirement.
- The Profit Distribution Rate for Financial Year 2022 is much higher than the average Islamic banking savings deposit rate for a 12-month period (0.35%) and the average Islamic banking fixed deposit rate for a 12-month period (2.34%) where the fixed deposit outflows cannot be made on demand.
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17 |
Will the Profit Distribution Rate change according to TH's profit in the following years? |
- The distribution of profits to depositors is based on TH's performance and financial ability in the current year and is subject to compliance with the requirements of the Tabung Haji Act 1995.
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18 |
What is the trend of savings by depositors in 2022 compared to 2021? |
- Depositors' total savings have increased to RM 87.60 billion on 31 December 2022.
- Depositor savings increased by RM4.27 billion or 5% compared to RM 83.33 billion on 31 December 2021.
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