Archive for May, 2015

Malaysian PM claims that Malaysian fund’s $1.1 billion from Cayman Islands are assets in USD

Thursday, May 21st, 2015

On May 20, Malaysia’s prime minister Najib Razak said that the remaining $1.1 billion that state investor 1MdB redeemed from its offshore account in the Cayman islands into a Singaporean bank was in USD-denominated assets.

1MdB, or 1Malaysia Development Bhd, has been dogged by years of controversy over its management of funds and the $11.6 billion in borrowings it has amassed to finance the purchase of power assets, a burden that has also weighed on the ringgit currency and on Malaysia’s sovereign credit rating.

According to Singapore’s Business Times, the $1.1 billion fund is collateral to a $975 million syndicated loan to 1MDB. The lenders, led by Deutsche Bank, were worried about the collateral and planned to ask 1MDB to pay up before the loan falls due in less than four months, the report said, citing sources.

Najib, who also chairs 1MDB’s board of advisors, told Pua in a parliamentary reply in March 2015 that the redeemed money was in cash form.

If the collateral is a financial instrument, its value can fluctuate to reflect market value.

Currently, 1MdB is under investigation by the Auditor General’s Department.