As part of its mandate to promote financial stability, Bank Negara Malaysia (the Bank) undertakes surveillance on significant non-bank financial institutions that have important interlinkages with the financial system. This is supported by the establishment of the Financial Stability Executive Committee (FSEC) under the Central Bank of Malaysia Act 2009 which is chaired by the Governor and whose members include the Secretary General of the Treasury, the Chairman of the Malaysia Securities Commission, the Chief Executive Officer of the Malaysia Deposit Insurance Corporation and an independent external member.

Based on the Bank’s surveillance, the Bank and the FSEC may, from time-to time, issue advice to significant non-bank institutions as a pre-emptive measure to promote the sound financial standing of such institutions and avoid any systemic implications on the financial system. In relation to Lembaga Tabung Haji, the institution has proactively taken appropriate measures to further strengthen its risk management practices, both on its own initiative and in response to earlier engagements with the Bank. These will reinforce a sustainable and healthy financial position of the institution going forward.

While Lembaga Tabung Haji is not under the direct supervision of the Bank, advisories issued by the Bank to non-bank financial institutions are aimed at ensuring the institutions will continue to be well managed and effectively perform the role for which they have been established. This in turn will contribute to financial stability.