Finance Ministry has settled RM1.69 billion of SRC International’s RM4 billion KWAP loan

Updated 4 years ago · Published on 2 Sep 2019 5:14PM · 5 Comments

Finance Minister Lim Guan Eng says the government has settled RM1.69 billion of SRC International's RM4 billion loan from KWAP thus far. – The Malaysian Insight pic by Seth Akmal, September 2, 2019.

THE Finance Ministry has thus far paid RM1.69 billion as part of its obligation in servicing SRC International Sdn Bhd’s RM4 billion loan from the Retirement Fund Inc (KWAP).

The RM4 billion government guaranteed loan facility was taken by SRC International from KWAP on August 26, 2011 and March 27, 2012, whereby the civil service pension fund had released RM2 billion on each date.

However, the company was unable to service its debt after being embroiled in a critical financial situation since 2015.

“Since the loan was guaranteed by the government and to avoid the event of a default, it has become the government’s responsibility to adhere to the repayment schedule of the financial facility,” said Finance Minister Lim Guan Eng in a statement today.

“Since 2015, MOF has been committed in ensuring that the payment obligation is fulfilled as per the repayment schedule to avoid any event of default and also to protect KWAP and civil servants,” he added.

The latest payment amounting to RM344.68 million was made on August 29. Of this, RM300 million was the principle, whereas the interest amounted to RM44.68million.

The next payment is scheduled for September 30, involving an interest of RM43.02 million.

“This amount is part of the remaining RM3,807,858,447.99 of the loan which is due in 2022,” he said.

SRC International was incorporated in January 7, 2011 as a subsidiary of 1Malaysia Development Bhd (1MDB).

The company was set up as an investment arm focusing on projects linked to the mining, extraction, processing, logistics and trading of conventional energy, renewable energy resources and minerals.

This also entails the holdings of shares and securities in related businesses.

On February 15, 2012, Minister of Finance Incorporated (MOF Inc) acquired 1MDB’s stake in SRC, by way of interim dividend-in-specie payment.

“Unfortunately, SRC International was also directly involved in the financial misappropriation scandal which the government had to eventually bear without revealing to the public,” said Lim.

He said the Finance Ministry will ensure that enough allocation is set aside to settle the loan facility to KWAP.

He said this goes to show the federal government’s ability in managing the financial burden that came from 1MDB and SRC International, which it had inherited from the previous government, despite its fiscal constraints. – September 2, 2019.

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Comments

  • Those approve the loans must be held accountable to the misdeed.

    Posted 4 years ago by James Wong · Reply

    • Cant agree more - the other scoundrels, besides Najib, should be hauled to Court and be make accountable for fraud and/or dereliction of duty.

      Posted 4 years ago by Rupert Lum · Reply

  • Celaka Najib

    Posted 4 years ago by Penganalisa L · Reply

  • As a guarantor..government has to pay..fine...but still tay payer money...but what are the benefits to the malaysian..where was the money goes...what was the purpose of the loan...it was a bloody huge of money but I did not see any outcome...any ROI or any benefits to the malaysian...the money just disappear...and we malaysian has to bare the consequences...its really not fare to the malaysian...and the culprit must be punnished..

    Posted 4 years ago by Zamri mohamed · Reply

  • Ask najib to pay...he caused so much blunder to the country...

    Posted 4 years ago by Zamri mohamed · Reply