KUALA LUMPUR, 2 APRIL 2024. Lembaga Tabung Haji (TH) has announced a sustainable profit distribution rate of 3.10 percent for Financial Year ended 31 December 2023, after taking into account zakat of 2.57 percent.

The 2023 profit distribution involves a total payout of RM2.72 billion, which will benefit over 9.15 million TH depositors, compared with the 2022 profit distribution of RM2.65 billion for 8.8 million depositors. This brings the accumulated profit distribution over the past 60 years since its inception to RM42.88 billion.

The 2023 Profit Distribution is made upon completion of audit on the financial statement by the National Audit Department and have taken into account impairments on legacy investments, especially the leased properties in Saudi Arabia and property investment in the United Kingdom.

The 2023 profit distribution also complies with the Tabung Haji Act 1995. As the country’s sole savings institution for the purpose of hajj, TH has declared zakat amounting to RM101 million for all State Religious Councils on behalf of depositors for 2023.

TH hopes that this will directly or indirectly assist government’s effort to eradicate extreme poverty nationwide. This brings the accumulated zakat payment to RM1.37 billion. TH allocates zakat based on the depositors’ savings balance for each state. Based on TH’s Shariah Advisory Committee recommendation, the rate of 2.57 percent is applied in the zakat calculation to account for the difference in the number of days in a year between the Qamari (Hijri) and Gregorian calendar.

TH has also provided assistance to over 560,000 asnaf across the country in 2023 through its Zakat Wakalah Programme, where TH acts as a representative for State Religious Councils to distribute a portion of the zakat funds directly to the asnaf. To date, more than 1.6 million asnaf have benefited from TH’s Zakat Wakalah Programme.

Yang Berhormat Senator Dato’ Setia Dr Haji Mohd Na’im Mokhtar, Minister in the Prime Minister’s Department (Religious Affairs) announced the Profit Distribution at a press conference in TH today.
TH Chairman, Tan Sri Abdul Rashid Hussain, Group Managing Director and Chief Executive Officer, Tuan Syed Hamadah Syed Othman and Group Financial Executive Director, Mustakim Mohamad were also present at the press conference.

“This is the third year of recovery for the economy since the Covid-19 pandemic.TH has been able to maintain a sustainable distribution rate for the last three years despite the impairment of several legacy investments,” Tan Sri Abdul Rashid Hussain said.

“This rate of return which takes into account zakat is indeed a good rate. As a government-guaranteed savings fund, TH carefully evaluates investment risks to protect depositors’ funds. Therefore, TH’s 2023 Profit Distribution is in line with the Strategic Asset Allocation (SAA) corresponding to our risk tolerance level and is aligned with the current market rates of Government instruments and the 12-month Islamic banking deposit rates”.

The global economy performed slower than expected in 2023 following high interest rates in the United States and Europe, international geopolitical crises, pressure on developing countries’ currencies including the Ringgit and China’s slow economic growth, which had also impacted domestic economic performance. TH, which has around 90 percent of its investments in the domestic market, has navigated challenges such as pressure on sukuk yields as well as the moderate performance of the stock and real estate markets.

2023 PERFORMANCE REVIEW

TH performance in 2023 was driven by Shariah-compliant investments in fixed income instruments that generated 52 percent of its total income, while 24 percent was contributed by equity investments. In addition, returns from real estate investments and the money market also contributed 24 percent to its total income.

Group Managing Director and Chief Executive Officer, Syed Hamadah Syed Othman said as a savings institution for Hajj purposes, TH focuses on responsible investments with a moderate risk tolerance, as outlined in the approved SAA. Furthermore, TH also adopts a diversified investment portfolio approach, aiming to foster sustainable, secure and resilient investment income.

“The profit distribution is based on the performance and financial position following the audit by the National Audit Department. TH is committed to further intensify its efforts to strengthen and improve its services to add value for the benefit of our depositors,” said Syed Hamadah.

The Profit Distribution for 2023 is computed based on the lowest average monthly savings balance for the year, which is the same computation applied in previous years.

Depositors can check for the Profit Distribution amount credited into their respective accounts starting 12.00 noon, Tuesday, 2 April 2024 through THiJARI, TH branches, Bank Islam and Bank Rakyat branches as well as electronic channels of its strategic partners namely Bank Islam, Bank Rakyat, Maybank Islamic, CIMB Islamic and AmBank Islamic.

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