The prime minister has assured Tabung Haji contributors that their deposits in the fund are safe. There is no reason for contributors to withdraw their savings since the government is the guarantor of their deposit.

The assurance is timely to pacify depositors given the recent controversy. But more importantly is the maintenance of standard and integrity of all financial institutions in the country.

For institutions that accept deposits from the public, financial integrity and confidence are the most important elements.  No amount of assurances issued by the government would help much to restore confidence once it is eroded.    

I have in minds institutions like banks, Permodalan Nasional Berhad (PNB) (through Amanah Saham Bumiputera (ASB), Amanah Saham Nasional (ASN), Amanah Saham Malaysia (ASM), Amanah Saham 1Malaysia (AS1M), Amanah Saham Wawasan (ASW), etc), Lembaga Tabung Angkatan Tentera (LTAT), Tabung Haji, Employees Provident Fund (EPF) and other mutual funds that accept deposits or investments from the public.

It is best that we don’t mess around with these institutions. It is best that the regulatory authorities impose the strictest propriety standards and oversights on them. It is best that these institutions are helmed by professionals with impeccable integrity able to withstand temptation, coercion and outside interference.

These institutions are the lifeblood of the economy and the deposits are sweat and blood of ordinary Malaysians. Any hint that the integrity of these institutions is compromised would yield severe consequences.   

Usually government assurances are too late or meaningless once the confidence is broken.  Therefore, the best strategy is to manage these institutions without having the need for the government to issue any assurances. Rightly, confidence should come from these institutions’ adherence to standards, integrity and prudent decision-making. These institutions should not be coerced into making any investment that does not satisfy their risk appetite or returns criteria.

It is just a reminder - don’t mess with these institutions because the consequences could be dire for Malaysia and its people.