Amid raging questions about its operations and financial health, 1Malaysia Development Bhd (1MDB) has settled a loan amounting to US$975mil (RM3.6bil) to a consortium of international banks.
In a statement, the government investment arm – which had racked up RM42bil in debts as of March 31, 2014 – asserted that the repayment yesterday showed its commitment to reduce its liabilities.
“On May 29, 2015, the Finance Ministry announced 1MDB’s plan to repay a US$975mil (RM3.6bil) loan to a syndicate of international banks. Today, we are pleased to confirm that the loan has been fully repaid,” 1MDB president and group executive director Arul Kanda Kandasamy said in a statement.
“This RM3.6bil repayment reflects 1MDB’s commitment to reduce its debt levels, in line with the rationalisation plan approved by the Cabinet,” he added.
In a separate statement, 1MDB said it had never approved any action or series of actions to transfer funds to any third party other than intended beneficiary in response to a fresh series of articles on its financial dealings over the weekend.
1MDB added that it had cooperated with authorities that were currently investigating the fund.
“The board of directors of 1MDB categorically denies that it has ever approved any action or series of actions to transfer funds from the company to any third party other than the intended beneficiary,” Arul said.
“Notwithstanding this, 1MDB has shared information with the Auditor-General Department and Bank Negara for further review and investigation,” he added.
The Edge weekly had claimed that 1MDB and its partner PetroSaudi Group manoeuvred the takeover of UBG Bhd – the investment arm of former Sarawak Chief Minister Tun Abdul Taib Mahmud.
It alleged that businessman Low Taek Jho, or better known as Jho Low, had in 2010 used US$260mil of 1MDB’s cash to buy out UBG.
Low served as a non-executive director of UBG from September 2008 to November 2010. PetroSaudi took UBG private in 2010.
Meanwhile, The Edge had rebutted 1MDB’s response by pointing out that the fund did not address the concerns raised.