08
May
16

1MDB’s house of cards set for collapse

1MDB’s house of cards set for collapse

MP SPEAKS The 1MDB house of cards has all but collapsed and Malaysians need to brace themselves for the bailout of the century of at least RM20 billion by the Malaysian government

The rationalisation plan

The rationalisation plan of 1MDB announced in May last year was always like a house built on sand.

1MDB noted in its press statement this morning that “1MDB now retains a cash surplus of approximately RM2.3 billion for infrastructure and other debt service requirements.”

“Future debt obligations are fully matched by the sale of Bandar Malaysia land, the development and sale of Tun Razak Exchange lands as well as the eventual monetisation of the Pulau Indah and Air Itam lands,” it said.

We have always maintained that the 1MDB rationalisation plan was built on sand as we were never convinced that the US$4.7 billion debt-asset swap plan will be successful.

This was because it was clear from 1MDB’s financial statements and the events which took place over the past year showed that 1MDB does not have equivalent amount of assets to “swap” with IPIC’s assumption of 1MDB debt.

The lack of conviction was made more obvious by 1MDB’s refusal to provide the auditor-general with the necessary documents to verify the value or even the existence of 1MDB’s overseas cash and assets.

Hence the continued insistence by 1MDB that “further debt obligations are fully matched by the sale of Bandar Malaysia land…” etc, especially after the collapse of the IPIC-1MDB agreement is an irresponsible attempt to continue play a game of smoke and mirrors.

…more
1MDB’s house of cards set for collapse
26 April 2016 – malaysiakini

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