Monday, May 18, 2015

`1MDB assets have strong value'

By Sharen Kaur

SINGAPORE: PEOPLE should look at 1Malaysia Development Bhd (1MDB) as a company with strong asset value instead of focusing on its debt level, top banker Datuk Seri Nazir Razak said.
 
  He, however, urged 1MDB to come clean with its financials and build back people's trust.
 
  "If you look at their books, at some level it is sustainable. We shouldn't just look at their debt. We should also look at the company's balance sheet and assets.
 
  "Some RM40 billion or RM50 billion of debts are not a lot. 1MDB has strong assets to back them. They have power plants, as well as the Tun Razak Exchange (TRX) and Bandar Malaysia developments.
 
  "The thing now is, 1MDB should come clean with their financials. They should have an independent body to look at their numbers and get to the bottom of things quickly," said Nazir, who is chairman of CIMB Group Holdings Bhd.
 
  He was speaking during a media luncheon at the Asean Business Council (ABC) Forum 2015, here, yesterday. CIMB is one of the main sponsors of the event.
 
  1MDB's current debt level is RM42 billion. It has power assets and landbank worth about RM50 billion.
 
  The TRX and Bandar Malaysia developments are expected to rake in an estimated gross development value of RM190 billion collectively over 20 years.
 
  To pare down its debt, 1MDB is planning to list its energy unit, Edra Global Energy Bhd, later this year to raise around USD3 billion (RM10.7 billion).
 
  Nazir felt that the controversy arose because 1MDB's board and management were "not equating".
 
  "If the board really have been doing their job, then they should have appointed an independent auditor to view their numbers. Why did they have to wait for the auditor-general or PAC (Public Accounts Committee) to come in?
 
  "We hear a lot of noise in the social media about 1MDB and the company has gone silent. And then we have the Tabung Haji transaction.
 
  The company should just get to the bottom of things quickly." He said if anyone had any concern about CIMB's financials, he would appoint an independent auditor.
 
  "I will appoint an independent auditor, who is not my auditor, to look at the numbers so that I have two credible auditors saying these are the numbers. This is something all companies should do."
 
  On Monday, PAC chairman Datuk Nur Jazlan Mohamed said it would begin its 1MDB probe on May 19.
 
  1MDB chairman Tan Sri Lodin Wok Kamaruddin has said it would extend its cooperation to PAC.

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