No time frame for 1MDB to bring back US$1.83b

PETALING JAYA: Bank Negara Malaysia (BNM) has not set a time frame for 1Malaysia Development Bhd (1MDB) to repatriate US$1.83 billion (RM7.2 billion) as instructed by the central bank.
The instruction came on top of an undisclosed penalty imposed on the state-owned investment fund for non-compliance.
BNM's new governor, Datuk Muhammad Ibrahim, explained that the lack of a timeline is due to 1MDB's need for time for its restructuring exercise, on which the US$1.83 billion is said to have been spent.
"We were told that the money that is supposed to be repatriated will be used to restructure the entity (1MDB); we give them time so that they can restructure," he said.
Of the US$1.83 billion, US$940 million is guaranteed by Aabar Investments and has been earmarked for a "debt for asset" swap with its parent International Petroleum Investment Co (IPIC), while the remainder is linked to historic equity and loan investments in a joint venture with PetroSaudi in 2009.
Muhammad noted that it is the central bank's practice not to disclose the amount of compound against any individual or entity.
The compound was issued against 1MDB last month for failing to comply with directions issued under the Financial Services Act 2013 following the revocations of three permissions granted by BNM to 1MDB in 2009, 2010 and 2011.
1MDB had failed to submit evidence and documentation specified by the central bank to justify its inability to fully comply with the repatriation order. However, it had said the payment will be made before the May 30 deadline.
Upon the compound payment is made, Muhammad said BNM will "close the investigation" on 1MDB pursuant to the rules and regulations that are under the purview of the central bank.
"For investigations that are not under us, we'll extend our cooperation to other regulatory bodies in Malaysia," he said.
Muhammad stressed that BNM will not interfere in the dispute between 1MDB and Abu Dhabi's IPIC, but noted that the government's commitment to honour its obligations on 1MDB will continue to provide financial stability to the country.