Malaysia ex-minister blames state fund for resignation

Ex-minister who resigned during cabinet reshuffle says fell ill after being entrusted with ‘financial mess’ created by 1MDB

Malaysia ex-minister blames state fund for resignation

World Bulletin / News Desk

A former Malaysian federal minister who stepped down during a cabinet reshuffle in June has revealed that beleaguered state wealth fund 1Malaysia Development Fund (1MDB) was a factor in his resignation.

Former Second Finance Minister Ahmad Husni Hanadzlah, 64, said Monday that he had fallen ill, no thanks to rising high blood pressure, months after he was entrusted to cover the "financial mess" created by 1MDB.

Hanadzlah told Malay-language daily Sinar Harian that he had been under heavy stress for months in dealing with controversy over the debts and financial affairs of 1MDB, which has amassed 50 billion Ringgit ($12.9 billion) in debt and been accused of financial irregularities in many countries.

He said in the interview that he suffered prolonged high blood pressure and had contemplated resigning since January.

"I was flying to Laos for a meeting of ASEAN [Association of Southeast Asian Nations] finance ministers when I suddenly fell ill. During that moment, a question from a senior official of the Central Bank finally prompted my decision,” Hanadzlah underlined.

"The official asked: ‘Everyone knows that you are not involved in 1MDB. Why are you feeling stressed over the 1MDB issue?' That is the moment I decided why should I worry over things I am not involved," he stressed.

Hanadzlah resigned from cabinet in June, when Prime Minister Najib Razak carried out a reshuffle, and also from all party positions.

He had served as the national treasurer and division head of the United Malays National Organisation, a major political party in the National Alliance that has ruled Malaysia since independence in 1957.

At the time of the reshuffle, Razak -- who appointed Hanadzlah as second finance minister in April 2009 upon becoming premier -- said Hanadzlah, who remains an elected member of parliament, resigned due to personal factors.

1MDB was incorporated in 2009, after Razak took over the premiership of the country, by transforming a small state fund into a federal agency.

1MDB was reliant on debt (bank loans, bonds and Islamic sukuk) as company capitals, where portions of the debt was government guaranteed or received support letters from the government.

The debt commenced at 5 billion Ringgit in 2009 and rose to 42 billion Ringgit, against assets worth 51 billion Ringgit as of the financial year ended March 31, 2014. During the period, 1MDB paid 2.4 billion Ringgit to service interest on the debt.

1MDB's debt level reached 50 billion Ringgit in January 2016, in contrast to the 53 billion Ringgit in assets. 1MDB spent 3.3 billion Ringgit for payment of interest on the debts between April 1, 2014 to March 31, 2015 (unaudited estimates).

Güncelleme Tarihi: 12 Eylül 2016, 10:55
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