KUALA LUMPUR, Jan 26 — Bank Negara Malaysia (BNM) today lauded Lembaga Tabung Haji for taking measures to strengthen its risk management practices, just hours after a news report alleged that the central bank had last December warned the fund of its negative reserve levels.

According to a statement from the bank, the fund’s actions would help it sustain a healthy financial position going forward.

“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,” the statement said.

“While LTH is not under the direct supervision of BNM, advisories issued by BNM 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,” it added.

The statement also said that the Financial Stability Executive Committee (FSEC), a committee chaired by the BNM Governor, secretary-general of the Treasury, chairman of the Malaysian Securities Commission, chief executive officer of the Malaysia Deposit Insurance Corporation and an independent external member, would constantly monitor non-bank institutions that have important links with the financial system.

It added that from time to time, BNM together with FSEC would offer advice on measures to promote the sound financial standing of such institutions.

According to news reports earlier today by The Malaysian Insider news portal, BNM Governor Tan Sri Zeti Akhtar Aziz allegedly told the pilgrimage fund in a letter dated December 23 that it only had “98 sen in assets for each ringgit in liability”.

It cited from an unverified letter to Tabung Haji that also said Section 22 of the board’s act did not warrant it to announce dividends and bonuses if its assets are lesser than its obligations.

The news portal also cited from another unverified letter the same day to Minister in the Prime Minister’s Department in charge of Muslim affairs Datuk Seri Jamil Khir Baharom, in which Zeti purportedly warned that LTH’s finances could impact Malaysia as “Tabung Haji’s deposits were wholly guaranteed by the government.”