Seeing light at the end of the tunnel

1mdb_logo_21022014_large

Time. Is the single most important component and commodity in unravelling and making good the entire mess within Federal Government strategic investment corporation 1 Malaysia Development Berhad (1MDB).

That is what was said by an independent observer to one of the UMNO State Information Chief on late Sunday evening, right after party President Prime Minister Dato’ Sri Mohd. Najib Tun Razak met an assembly of all Information Chiefs at Division, Wanita, Pemuda and Puteri level in PWTC.

Pro=Anwarista The Malaysian Insider story:

Najib promises to solve 1MDB saga by year’s end
BY RAM ANAND

Published: 14 June 2015 6:24 PM

Prime Minister, Datuk Seri Najib Razak walks out from PWTC after briefing Umno division information chiefs on current issues. – The Malaysian Insider/Afif Abd Halim, June 14, 2015.
Prime Minister, Datuk Seri Najib Razak walks out from PWTC after briefing Umno division information chiefs on current issues. – The Malaysian Insider/Afif Abd Halim, June 14, 2015.
Prime Minister Datuk Seri Najib Razak today promised Umno leaders and pro-establishment non-governmental groups that he would solve controversies surrounding 1Malaysia Development Berhad (1MDB) in two months, at the earliest.
Najib said so during a closed door session with Umno division information chiefs and NGOs at the Putra World Trade Centre (PWTC) today, according to one of the attendees.

Hasan Hamzah, who is de-facto leader of the group Gabungan Bertindak Perpaduan Melayu, said Najib had made this pledge and given a timeframe of between two to six months.

“Earliest is two months, but at any rate, he said he will solve it by the end of the year,” Hasan said when met at PWTC, which houses the Umno party headquarters.
Other Umno leaders, however, remained coy about the details of the closed door briefing which began earlier this afternoon.

The briefing today was held for Najib, who is also Umno president, to address party grassroots leaders on the recently-tabled 11th Malaysia Plan, the goods and services tax (GST) and other current issues.

Najib is hard-pressed, too, to explain allegations concerning 1MDB, which is his brainchild and which sits on a RM42 billion debt incurred in six years of operations.

Hasan said that since 1MDB is a business entity, solving it won’t be done in a short time.

“A lot of the allegations against 1MDB are just from the opposition. The PM admitted there are problems, but this is a business entity, it has enough assets,” he said.

“But it cannot be done immediately. So that is what the PM is asking for – time. If we give him enough time, he would be able to solve all the problems,” he added.

Hasan also urged Najib to meet former prime minister Tun Dr Mahathir Mohamad as soon as possible to explain the same to the latter.

“It’s all about a clash of personalities, Tun had his way of administrating, now Najib has his own style,” he said.

Hasan said that Najib, without specifically referring to Dr Mahathir, had said that since Umno supports him, he would stay in the job and solve the problems.

“He said he cannot bow down to an individual’s pressure, whoever that may be,” he said.

“The PM is just disappointed. He feels we shouldn’t be fighting for an issue that is not big,” he added.

Dr Mahathir had repeatedly called for Najib’s resignation.

Hasan said that representatives from 1MDB and the Ministry of Finance were also in attendance during the briefing.

Meanwhile, Umno Youth information committee member Rozaidi Jamil said that if Najib had explained such details earlier, many of the controversies surrounding 1MDB would not have taken place.

“What was explained was very clear. If this was explained before this, we would understand. Why wasn’t it answered before?” Rozaidi said.

He also said that if Dr Mahathir had been in attendance today, even he would be supportive of Najib. – June 14, 2015.

– See more at: http://www.themalaysianinsider.com/malaysia/article/najib-promises-to-solve-1mdb-saga-by-years-end#sthash.lMlK324O.dpuf

********************

Needless to say, many are still fuzzy about what happened and what steps to be taken. Some are still skeptical. However, majority are still wishful that all are able to be made good for the betterment of many, especially the Malays.

“Give it time. All the mess would be made good and the money would be there and the benefits for all these strategic investments meant eventually for rakyat through programs which would alleviate their socio-economic standing would eventually transpire and materialise”.

And systematically bit by bit, 1MDB starts to unravel all the questions and malign allegations thrown at them. In the utter convenience, connivingly they have been disguised as “Questions people asked”, in the breadth without changing the tone, implicate Prime Minister Najib’s poor and weak policies, management capabilities and worse of all, carelessness.

Even the most technically competent critics have narrowed their scope to dissect all these new information being introduced into public consumption for the first time by 1MDB.

The Star story:

Published: Wednesday June 17, 2015 MYT 12:00:00 AM
Updated: Wednesday June 17, 2015 MYT 7:28:22 AM

1MDB answers its critics

PETALING JAYA: 1Malaysia Develop­­ment Bhd has defended itself against criticism by former prime minister Tun Dr Mahathir Mohamad by addressing various issues, from the Cabinet being unaware of a fund-raising exercise for its start-up in 2009 to events leading to its investments in Cayman Islands increasing to US$2.318bil (RM8.57bil).

The fund that is wholly owned by the Finance Ministry has come under relentless attacks from not only Dr Mahathir but also some ministers for its cash-flow problems in meeting obligations for its debts of RM42bil.

Rebutting allegations that a Cabinet paper was not prepared for the Government guarantee that allowed 1MDB to raise RM5bil in Islamic bonds in 2009, the fund said the matter was prepared and approved by the Cabinet.

It also said the RM5bil Islamic bond issuance was fully underwritten by AmBank, which earned all the commission and not Goldman Sachs.

The other contentious issues raised by Dr Mahathir that 1MDB addressed were:

> The interest per annum on the RM42bil loan is RM2.4bil, and not RM3bil;

> The RM5bil Islamic debt paper was issued at a yield of 6.15%, not 7% as alleged, and that it was fair given the tenure of the paper stretching over 30 years;

> The RM2bil loan furnished by billionaire T. Ananda Krishan’s Tanjong group to 1MDB in February was in accordance with an agreement signed between both parties on Aug 7 last year;

> The Tun Razak Exchange (TRX) land was acquired for RM230mil, not RM320mil as alleged. 1MDB has to build the infrastructure for the TRX development that comes up to RM1,500 per sq ft;

> PetroSaudi International (PSI) injected oil fields in Turkmenistan and Argentina worth about US$2.7bil into a JV company which 1MDB paid US$1bil for a 40% stake. Dr Mahathir alleged that PSI did not “inject a single cent” into the JV company; and

> The 40% stake in PSI was later converted into an Islamic loan. 1MDB’s total exposure to PSI between September 2009 and June 2012 came up to US$1.83bil. The loans were converted to equity and eventually sold for US$2.318bil, an exercise that 1MDB claims earned it a return of US$488mil.

1MDB said the US$2.318bil was put in a Cayman Islands-registered fund and in return it received “fund units”.

“These fund units were owned by 1MDB via its 100% subsidiary, Brazen Sky, and held through BSI Bank Singapore as custodian,” it said in a statement yesterday.

The value of the investments held by Brazen Sky in BSI Bank came into question because the money is not in the form of cash but “units”.

In March, Prime Minister Datuk Seri Najib Tun Razak told Parliament that 1MDB’s investments had been redeemed and the “money” was placed with BSI Bank.

In May, the answer was amended to state that the investments had been redeemed and were in the form of “units”.

1MDB president and group executive director Arul Kanda Kanda­samy was also reported to have said on foreign media that he had seen the cash.

On this matter, 1MDB denied that Arul Kanda had said he had “seen the cash” and stated that there was a misunderstanding that led to the answer by Najib, who is also Finance Minister, in Parliament.

****************

That is actually good and moving forward because from now on, it would be the battle of wits for those who understand the complex intricacies of the capital and debt markets, coupled with the exercise to acquire and re-list large corporations in a very short span of time and opportunity.

That is not withstanding the ambitious and courageous corporate move to do mega super luxurious integrated property development programs, matching the intensity of new financial hubs in the likes of Shanghai, Singapore, Dubaii and Abu Dhabi.

Unless we are drawn into those who purposely wanted to throw spanners to the works every opportunity arises and destabilise the system for all the wrong reasons. The systematically crave to erode confidence and turn the people against the Ruling Party and Federal Government.

Pro-Anwarista Malaysiakini newsportal story:

7:23AM Jun 17, 2015
Malaysiakini

Report: PM’s brother to start new political party

643 79 3 40

Banker Nazir Abdul Razak, the younger brother of Prime Minister Najib Abdul Razak, has initiated the formation of a new non-partisan political party to reach out to all races, the Asia Sentinel has reported.

The report said the new party seeks to “dramatically redraw the country’s political landscape” and put an end to divisive racial politics.

Nazir, who heads the CIMB Bank, is reported to have approached former deputy education minister Saifuddin Abdullah, one of Umno’s few liberal-minded leaders, to lead the new party.

“Nazir’s friends have advised him that he must emerge as the prime mover, or it won’t work.

“Saifuddin (photo), as much as he is respected as a moderate, doesn’t have the widespread clout to attract support,” says the report.

When contacted by Malaysiakini, Saifuddin declined to comment on the matter.

The Asia Sentinel report comes amid the start of Pakatan Rakyat’s disintegration and increasingly cozy ties between PAS and Umno.

This, said the report, has set the stage for possible political realignments, as BN component parties – MCA and MIC – might ditch Umno for more favourable partners.

Nazir, who is a widely respected banker and son of Malaysia’s second prime minister, could provide the platform for a new coalition, it said.

Muhyiddin ‘not acceptable’

Over the past few months, Nazir had shown himself to be critical of Putrajaya’s policies, especially in the handling of the 1MDB controversy, giving him an air of credibility.

And unlike other unsuccessful political upstarts, the report noted that Nazir and his business cohorts are very capable of raising the funds necessary.

Asia Sentinel added that former PM Dr Mahathir Mohamad, the prime mover in the bid to oust Najib, is willing to wait until Umno’s annual general meeting late this year to install Muhyiddin as prime minister.

“Muhyiddin is hardly acceptable to Nazir’s moderates. He is a Malay nationalist himself and, at age 67, has amassed a fortune of suspicious size,” said the report.

“His son, Fakri, is also involved in many business deals, including a RM4.1 billion contract supplying 4G computers and Internet study to rural schools.

“He is partner to YTL in the project, called Bestarinet, which was reportedly engineered by Muhyiddin himself to YTL and which opposition leaders and teachers say is a failure.”

****************

Our advice is try to eye ball and keep up with this game where more mechanics of the complex investment banking play would be slowly surface. Otherwise, hold on to your horses and let those who are masters of the game do their job and reveal their work when it is time.

In simpler analogy, building sites are hoarded to allow the constructers and consultants finish their job without interference and the same time safety for the public is ensured. Only people involved and authorised have access to the progress of the project. Same goes to preparation of an elaborate meal for a banquet of heavy diners.

One would not get to see the end result until it is completely finished and that is when the critics should lash their thoughts and opinion. Not during the complexity and mess of the preparation for the banquet.

Probably it is too wishful to ask for ‘gloves off’ even though Ramadhan starts when the sun set this evening. Needless to say, in the suggestive words of the ‘good doctor’ to one to cease fire against one of then his most trusted loyalist slightly less than four years ago, “Try to tone down a bit lah”.

Selamat Menyambut Ramadhan Al Mubarak 1436H

Published in: on June 17, 2015 at 09:45  Comments (20)  

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  1. Quote: “Same goes to preparation of an elaborate meal for a banquet of heavy diners.”

    BD

    It is precisely because of the HEAVY diners (RM 42 bilion) that a super chef MUST be recruited to OVERSEE the preparation.

    We don’t want to see massive FAILURES (like raw meat, flat cakes, tasteless desserts, filthy crockery) which necessitates an essential requirement that 1MDB must and should be critically MONITORED.

    Sebelum nasi menjadi bubur.

    P.S. Even at construction sites of luxury buildings, architects and supervisors abound. It should never be left to the manual workers to do as they please – under the cloak of security.

    • TQVM

      We hv that experienced Executive Chef in the house. His name is Arul Kanda Kandasamy.

      He would not have agreed to summarily leave his highly-paid-high-flying job in Abu Dhabi in January to come back to KL and do this job, if he felt it couldn’t be done.

      He had all it made on his own. Sitting in RHB and RHB Islamic BoD till a few years back and now an EVP back in a very wealthy financial house in the Emirates, at 39 years old.

      Most people at that level would just stay where they are and not go do trouble-shooting job. Especially in a challenging job which has now been highly politicised.

      So he must have a good plan. Otherwise he would not have agreed to come over and clean the mess that Shahrol and Hazem left and make them good, which include the IPO of Edra Energy which was actually scheduled to hit the bourses in November 2013.

      Arul being an experienced and highly respectable banker can do what bankers do amongst themselves. That alone is a key element for this to be a success story.

      And Arul has Deloitte to provide him the check and balance he requires, so that he could do the necessary ‘trims and cuts’, tweaking of the business models and move 1MDB forward to be:

      1. Financially sound
      2. Financially solvent
      3. Business takes off
      4. Yield is ensured

      Nasi belum jadi bubur lagi. Tapi selagi ramai yang ‘kacau dan mengacau’, penghabisbya apa pun tak akan siap dan semua orang putih mata.

      Let the professionals do their job. Yes we all want answers. However, we already have some today. It may not satisfy to our heart’s content but it is still some information.

      It is time the protagonists lay off for a bit. Give it a bit of time. Probably six months, the very least. After all, Rome wasn’t built in a day. And to scorch Rome, its hardly day’s job.

      Then again unless the professionals are allowed space, time and opportunity to complete what they are expected to do without disturbance and interference, then nothing good will come out of it.

    • To me the issue in the 1st place is: Is the RM42 billion totally justified expenditure.

      Are all the investments transparent/ can they be made transparent so that the allegations connected to Rosmah’s high living expenses, her son becoming multi-millionaire quite quickly, his close links with Jho Low can be put away.

      Can some one throw some good light on this, pls.

      • They won’t answer this or better yet can’t answer this. How to call a spade something else. Perhaps with time they are hoping they will be able to spin their way out of this mess.

        Vote PAS je. Habis cerita.

      • nizam,

        I was following every word you wrote intently. Until you said Vote PAS je.

        Bukan habis cerita, tapi bedentum merudum minat aku kpd apa yang kau kata, Mamat.

        PAS dah gaduh besar dengan DAP dan Pakatan dah mampus, kata anak beranak Kit Siang dan Guan Eng. Tak payah lah masukkan depa dalam kes yang ramai orang tak faham ni ha, nizam. Lebih baik kau suruh PAS work together dgn UMNO tu ha.

      • Really la nizam, takan la tak faham2 apa sebenarnya limkomunis ni nak.
        LKS tak lupa yg ramai lupa2 org melayu apa yg dia dah buat dan masih buat lagi hgga skrg dgn cara halus. Cara halus,bkn jumpa bomoh tapi cucok jarum. Tk.
        Selamat menyambut bulan mulia ini dgn penoh keikhlasan.

  2. People still accusing 1MDB of RM42 billion disappearing despite Arul’s answers with details.

    However, thus far, no one could convincingly dispute his explanation which was detailing the audited annual account’s balance sheet.

    Comments from certain bloggers have been attempts to dispute some figures and posing more questions but the amount does not add up to RM42 billion missing or able to dispute the RM42 billion is accounted for.

    Tun does not believe it and he said that is not the answer. It means he has the answer. So the onus and responsibility is on him to divulge his proof. Otherwise, Tun LIED!

    Tony Pua attempt to dispute the explanation by doubting the auditor in the PAC session with auditor to question the auditor’s view of on going concern. Since he is not a qualified accountant, he does not have the locus standi to dispute thus had to write in to MIA. Hopefully his politically motivated questions have traction.

    Fact is at the material time the audit was done, 1MDB is an ongoing concern and still an ongoing concern if not for Tun M lending a hand to the anarchistic bloggers, opportunistic Tony Pua and Rafizi to disrupt 1MDB operation.

    Current restructuring is a subsequent event but does not mean the account has to be treated as though it is under liquidation. It has not defaulted on any loan since no lender has called for its default.

    There is no worry of default since its borrowing has asset matched to it. Same like the RM2 billion Ananda so-called loan which is not a loan as alleged by Tun M.

    Till Tun M correct his mistake and admit he LIED or he show his proof, then this will soil his reputation as statesman. A lie could not sustain to perpetuity. The truth is already out there and given time, people will see the light.

    • Good you explain some. But do continue explaining when people ask more. Indeed, some may disagree with you, unless perhaps you state your accounts or financial qualifications so that they lend weight to what you state.

      As I think hard business facts and figures are also subject to interpretation, no?

      “at the material time the audit was done, 1MDB is an ongoing concern ..” Does this mean nobody can ask? What and when can people ask, pray tell. I loathe DAP but saw something in Tony Pua’s question about Deloitte giving 1MDB a clean bill of health yet people were talking about the overdue loan repayments – were they not overdue or becoming overdue and no ready cash for the repayment?

    • There is no worry of default since its asset is matched by its borrowing? So next time interest payments are up, they liquidate their assets or what? You do know borrowings are to be paid in cash and not by supposed values of assets?
      I think instead of saying Dr. M needs to correct his mistake, you need to correct your understanding in finance

  3. On battles during Ramadhan, Islamic experts have pointed out that battles are allowed when fighting the enemy, e.g the Battle of Badr, where Prophet Muhammad’s outnumbered forces won against the Jews and the infidels.

    The only question is the interpretation of what and who constitute the enemy.

    Nevertheless, let’s hope the explanations at the PAC hearing both by the 1MDB CEOs (past and present) and by the Auditor General’s interim / preliminary report would satisfy the public. Including those who know how to understand audited accounts and look for the missing links or understated facts and figures, if any.

    And good that we may now see light at the end of the tunnel. Whether it’s a long or a short tunnel depends on the explanations given.

  4. Good that 1MDB have started to put out explanations. If only these were done at the beginning of the 1MDB controversy. It should not have waited until pressured to get the facts and explanations laid out readied for the PAC hearing.

    I still don’t understand why they didn’t gather and give out those facts and figures like published by the Star much earlier, like at the time when Tun Dr Mahathir started asking questions.

    No doubt big corporations usually just put out their audited reports and be done with them at the Annual General Meetings where the majority share holders’ representatives can pass a resolution accepting the audited accounts without much ado. But this is not just a big corporation; it’s a huge sovereign wealth fund involving taxpayers money.

    And 1MDB may have been audited by Deloitte up to the end of 2014. But in the case of Enron in the US, didn’t the firm Arthur Anderson audit them and yet anomalies surfaced and Enron crumbled? And Tony Pua questioned in Parliament why was that, while Deloitte said 1MDB could face its financial obligations, yet 1MDB had to struggle to make its loan repayments soon after, prompting allegations that banks got jittery.

    Yes, let’s now discuss those 1MDB answers. Laymen should be allowed to comment and those in the know help explain so as to lessen misunderstandings, without questioning too much the intent of such comments or questions.

  5. BD,

    You think with all of these explanations from Arul or the thumbs up from Deloitte with the Auditor General stating “There is no irregularities in their business transactions” OR even MACC says there is no case against any individual within 1MDB that can be charged under their act, the mighty Tun Mahathir would let go?

    All these is never about 1MDB. Its never about GST. Its never about BR1M.

    Or Rosmah. Or Sirul. Or brand new ACJ 320. Or what ever nonsense that any simpleton Malaysian can cock up in the lamest excuses.

    Tun Mahathir don’t give a flying toss of anything of those!

    It is all about the ultra passionate ex-prime minister thinks that he is right and things should be like the song he often sings, “I did it my way!”.

    Its his way or no way!

    Not buts! No ifs!

    Not even when. It must be now, now, now!

    This round, Tun Mahathir is the predator. The last round he was denied ‘voice’ because there ICT democracy isn’t as big, fast and sporadic as what it is today. And the listening in audience is even multiple times larger.

    He would continue to go after Najib’s veins and hang him dry on the mart square even if 1MDB could be nursed back to super health in unimaginable short time and make extra-ordinary money and increase in investment value with the whizz boy Arul’s magical touch.

    Its all about Tun Mahathir wanting to kill Najib’s political career!

    Why?

    That is where bloggers like you should unravel. That is where the real game is all about. Not when 1MDB is getting better!

    • you ever heard of KISS? Why would Dr. Mahathir want to kill Najib’s career now when he could have stymied it from the start? There is no issue and no mystery. The Dr. feels that there is hanky panky and wants the hanker panker to get lost.

    • MR

      You have just made a SERIOUS allegation. Let’s hope you are not taken to task later.

      When PUBLIC funds amounting to RM42 billion is at stake, every citizen has a right to query especially when the 3-in-1 person is clueless – giving unsatisfactory answers – bordering on outright lies.

      Where the common folks may not fully understand – Tun Dr M had been approached by concerned professionals to be the voice representing them.

      See that you don’t have to swallow your toxic and vicious spit in the immediate future.

  6. selamat berpuasa bigdog. Keep up the effort

  7. I usually don’t read Malaysiakini. But the news heading attracted me into reading the piece “Pua joins Dr M, calls Arul ‘liar extraordinaire'”. And now I don’t know who is correct. Excerpts:

    Former prime minister Dr Mahathir may have called 1MDB president Arul Kanda a liar but Tony Pua upped the ante today, calling Arul “liar extraordinaire”.

    This is after 1MDB, in a lengthy explanation yesterday, tried to deflect Mahathir’s accusation that Arul had lied about 1MDB’s funds. This is after Arul claimed he saw 1MDB’s cash of US$1.103 billion being redeemed from the Cayman Islands and parked in Singapore, which turned out to be “units” instead of cash. However, 1MDB said yesterday that Arul had never said he saw the cash.

    Pua said “The 1MDB president specifically said: ‘the cash is in our accounts and in US dollars. I can assure you (about that)… I have seen the statements’.

    “It is therefore disingenuous for 1MDB to just quote Arul Kanda as having ‘seen the statements’ without also quoting the sentence, ‘the cash is in our accounts and in US dollars'”

    He added that even though 1MDB had admitted it made a mistake by claiming “units” to be cash, it took almost two months to clarify the matter. The Finance Ministry was forced to correct its answer to Parliament about the status of the funds and blamed 1MDB for the erroneous explanation.

    “if there was indeed misunderstanding in the response provided to the Finance Ministry, why did Arul not immediately correct the massive mistake on March 10, when the ‘cash’ answer was provided and widely published?

    “Instead, Arul waited until more than two months later, on May 19, after I had posted the question again in Parliament, before issuing the correction. If I did not ask the question, the truth would never have surfaced,” Pua said.

    Sincerely, can somebody please explain who is right.

  8. Well mr blogger i’m glad you are so upbeat. I’m sorry but so many people i know do not trust the explanations they have deigned to share with us. And this too only after the public outcry esp by Tun (Allah bless him).
    Can you still have trust when one time it’s cash, errr asset/shares/ then err Unit (whatever animal this is)? And it took 2 mths to correct this???
    Tell us how to have confidence?

    They are now going to town to say that Tun has got facts and figures wrong? How can anyone when 1MDB is not forthcoming with info.Everything so opaque.
    Told to appear before PAC, absent.
    Last time said no problem with 1IMDB, now wait until end of year…everything will be solved. So now admit ada problem lah,.

    How to have confidence?


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