MoF�s payments to KWAP for SRC loans rise to RM1.73b

Published on 03 Oct 2019. | Source: theedgemarkets.com

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KUALA LUMPUR: The ministry of finance (MoF) said it made another payment of RM43.02 million for SRC International Sdn Bhd’s loans from the Retirement Fund Inc (KWAP) on Tuesday.

Stressing that it is committed to its repayment obligation, the MoF said it has so far made repayments totalling RM1.73 billion.

Under the repayment schedule, the next payment is due on Feb 28, 2020, involving an amount of RM37.81 million, the ministry said in a statement yesterday.

SRC, a subsidiary of 1Malaysia Development Bhd (1MDB) before it was taken over by the MoF in 2012, took government-guaranteed loans totalling RM4 billion from KWAP.

Of the RM4 billion, as much as RM3.6 billion or US$1.1 billion had been transferred through offshore companies into BSI Bank in Switzerland (more than US$800 million), Bank Julius Baer & Co Ltd in Hong Kong (US$250 million) and a coal exploration company in Mongolia (US$60 million).

“Since a huge chunk of the funds has been used in many corners of the world, the government is taking the necessary steps to recover as much of the RM4 billion as possible. SRC has been in critical financial distress since 2015, resulting in its inability to fulfil its repayment obligation to KWAP,” Finance Minister Lim Guan Eng said in the statement.

“The RM4 billion loans are part of a committed government guarantee. This was covered up by the previous administration and unearthed after the change of government on May 9, 2018. It is apparent that the RM4 billion loans are an embezzlement scheme and a case of kleptocracy which involves the 1MDB scandal,” said Guan Eng.

The minister said the current administration will ensure that this wrongdoing, which has resulted in huge losses for the government and its people, will not be repeated.

“The MoF will ensure a sufficient allocation of funds to ensure timely payments, which have been fixed for the preservation of the civil service retirement fund,” he added.