The Malaysian government faced a potential RM74.5 billion liability risk in 2018 if a massive bank run had occurred at Tabung Haji, the country's pilgrimage fund, according to officials and the recent Royal Commission of Inquiry (RCI) report released on July 29, 2026 [1, 2, 3]. Dr Zulkifli Hasan stated, "If TH had collapsed, the government would have faced potential liabilities of about RM74.5 billion, as all deposits with TH are fully guaranteed by the government." He added, "Imagine if no hibah had been declared. How much panic withdrawal could have occurred?" [1] Tabung Haji was technically insolvent at the end of 2018, with a funding gap of over RM10 billion between assets and liabilities [1]. The Pakatan Harapan government implemented a financial rescue and restructuring plan to restore solvency and sustainability [1, 2, 3].
Despite the risk being averted in 2018, early 2019 saw panic withdrawals of RM6 billion in a short period following the announcement of a 1.25% hibah (dividend) for 2018, highlighting depositor nervousness [1, 2, 3]. The RCI report identified governance and investment weaknesses at Tabung Haji from 2014 to 2020 and made 25 recommendations; 75% had been implemented as of July 30, 2026 [1].
Tabung Haji recorded RM4.64 billion in investment income in 2025 and distributed RM3.22 billion in profit at a 3.5% payout rate to over 9.7 million depositors — its highest profit rate in eight years [4]. The RCI recommends the fund’s investment function stay within Tabung Haji under a dedicated entity, Dana Haji, to be licensed by the Securities Commission [5, 4]. Bank Negara Malaysia and the Securities Commission are reviewing amendments to the Tabung Haji Act 1995 aimed at stronger governance and investment oversight without dismantling Tabung Haji [5].
Meanwhile, the government has yet to fully settle a RM12.5 billion financial commitment linked to the maturity of Urusan Jamaah Sdn Bhd's Series 1 sukuk on May 29, 2026 [6, 7, 8]. Only RM965 million was settled through property assets, with the remaining RM11.5 billion swapped for new sukuk maturing in 2036 [6, 7, 8]. Although the government approved annual budget allocations since 2019 to repay this debt, actual payments lag behind, with only about RM500 million paid so far to redeem the sukuk [6, 7, 8].
Datuk Seri Rafizi Ramli urged the government to settle the sukuk debt fully, saying it "should settle its commitment to fully redeem the RM12.5 billion owed to Tabung Haji, either in cash or equivalent assets" and called for transparency during a parliamentary debate today on the billions allocated to rehabilitate Tabung Haji but not accounted for [6, 8].
