KUALA LUMPUR (Aug 11): Lembaga Tabung Haji’s (TH) investment in Putrajaya Perdana Bhd (PPB) and putting the then TH chairman as PPB chairman have dragged TH into 1Malaysia Development Bhd’s (1MDB) transactions, ultimately causing RM145.3 million in losses.

Minister in the Prime Minister’s Department (Religious Affairs) Dr Zulkifli Hasan said Putrajaya Perdana was among 14 problematic investments linked to losses totalling billions of ringgit in the Royal Commission of Inquiry (RCI) report on TH.

He said TH had also purchased land at the Tun Razak Exchange (TRX) from 1MDB when the controversy was at its peak. 

“A big question arises when TH’s chief executive officer was also a member of 1MDB’s board of directors.

“Was the investment at that time in the interests of TH, or to solve the problems of other parties?” said Zulkifli during his briefing session on the Royal Commission of Inquiry (RCI) report on TH and the efforts and actions taken to restore TH’s financial position, at the special sitting of the Dewan Rakyat on Tuesday.

The minister said the listing of FGV Holdings, hailed as the success of the country’s largest initial public offering (IPO) after raising more than RM10 billion, also affected TH later, when it incurred losses of over RM1 billion. 

“When the share prices fell, TH continued to hold the shares even though their value had fallen by more than 80%, while only making changes to the impairment policy to ‘hide’ and obscure the losses,” he said.

Zulkifli said that since TH’s financial standing is now stronger, TH had purchased back the land in TRX, which it sold in 2018 for RM400 million, at a price of RM270 million based on the current market value.

In addition, TH had acquired the oil palm plantation of UJ Estates (Holdings) Sdn Bhd, which it had previously sold for RM800 million, at a current market value of RM695 million this year (including RM115 million in cash, giving an enterprise value of around RM580 million).  

On July 29, the 211-page RCI report was made public, containing various findings related to weaknesses in the management and operations of the institution for the period 2014 to 2020.

The RCI report also submitted 25 recommendations for improvement actions, 75% of which had been implemented by TH as of July 30.

The government announced the establishment of the RCI in 2021, followed by the appointment of RCI members on Jan 20, 2022, which saw the RCI report subsequently presented to the King on Aug 30, 2022.

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