1MDB bail out claim is misleading, says Najib

Former prime minister Najib Abdul Razak has accused Finance Minister Lim Guan Eng of misleading the public by claiming that the last administration had bailed out 1MDB.

In a statement late this evening, Najib said Ministry of Finance Inc (MOF Inc) had to service 1MDB's debts and liabilities after taking over the company's assets.

Najib said that the taking over of the assets - which included prime real estate - was among the recommendations made by the Public Accounts Committee.

"Over time, these prime real estate assets can be worth up to more than RM30 billion.

"Put in another way, had those assets remained in 1MDB, they could have developed and sold the assets on their own, and used the proceeds to pay the debts," he said.

But since MOF Inc had now taken over 1MDB's debts as well, it thus had an obligation to service the debts in return for taking over the assets, he said.

He said that the Finance Ministry could use various methods to fulfil this obligation including the sale of land to Bank Negara Malaysia (BNM) or redeeming money from Khazanah Nasional Bhd.

"There is nothing wrong with such transactions as they were approved per the relevant governance framework, were conducted on an 'arm's length' basis and followed the correct laws and procedures.

"Therefore, the question of MOF or BNM or Khazanah bailing out 1MDB does not arise at all. It is in fact downright misleading to make such allegations.

"MOF Inc took over assets and it must be responsible for the liabilities. That is the only correct way, legally and accounting-wise," said Najib.

'Walk the talk'

He said it was therefore wrong for Lim to only highlight the debt but not the assets which were now in the Finance Ministry's possession.

"The finance minister must walk the talk on CAT (competency, accountability and transparency). He has to be transparent to tell the full story and not just half a story in order to deceive," he said.

On Tuesday, Lim had revealed that the Finance Ministry had made RM6.98 billion in payments on behalf of 1MDB to various creditors over the past year.

Another RM143 million is due on May 30. Critics say that under the previous administration, the debt repayments amounts were unclear. -Mkini