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1MDB finally shows the money trail (Updated)

Kandasamy: "We trust that this clarification will clear any confusion."

Kandasamy: "We trust that this clarification will clear any confusion."

Syndicated News
Written by Syndicated News

KUALA LUMPUR — June 3, 2015: 1Malaysia Development Bhd (1MDB) has given a clear breakdown of how the RM42 billion debt raised by the strategic development company was used, contrary to speculation and criticism that money was alleged to be lost or missing.

The debt was used to buy power assets and land, for financial expenditure, to deposit in investment funds, leaving a surplus cash of RM0.9 billion, all of which totalled RM41.8 billion, said its chief executive officer Arul Kanda
Kandasamy in a statement today.

Information on how the debt was used is fully disclosed in the audited and publicly available accounts from March 31, 2010, to March 31, 2014.

“A total of RM18 billion was used to finance the purchase of power assets like Powertek Energy (RM8.5 billion), Kuala Langat Power Plant (RM2.3 billion) and Jimah Energy (RM1.2 billion) while the remaining RM6.0 billion was inherited debt,” Arul Kanda said.

1MDB spent RM200 million to buy the TRX land, RM400 million to buy the Bandar Malaysia land and RM1.1 billion for the Air Hitam land in Penang.

On the RM5.8 billion financial expenditure incurred, RM4.5 billion was used as finance cost and working capital, RM900 million for foreign exchange costs and for taxes which amounted to RM4oo million.

The company also deposited RM15.4 billion in investments funds such as Brazen Sky
(RM6.1 billion), 1MDB GIL Find (RM5.1 billion) and Aabar Deposit (RM4.2 billion).

“In recent weeks, there has been much speculation about the use of RM42 billion of debts raised by 1MDB, and more specifically that RM27 billion of debt proceeds are alleged to be lost or missing.

“We trust this clarification will help clear any confusion,” Arul Kanda added.

Bank Negara (BNM) today also issued a statement to say that it has commenced a formal inquiry on 1MDB to examine any contravention of the central bank’s rules and legislation.

“This has involved the issuance of a legal directive requiring information from the entity,” said the statement.

BNM said it is also taking statements from individuals involved in the governance process and obtaining information from other relevant domestic and foreign parties.

In addition, it has forwarded information received from foreign authorities to the relevant investigation agencies after obtaining permission from foreign authorities.

“The central bank wishes to emphasise that further disclosure of details of the investigation may undermine the outcome of the investigation.

“It is doing everything within the powers provided under its legislation, including collaborating with other agencies, to contribute towards
a swift resolution of the matter,” it said. — Bernama

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