KHAZANAH Nasional Bhd said it will clarify and reaffirm its mandate with the government, following several reports today that the prime minister had criticised the sovereign wealth fund for making “funny” business decisions and losing sight of its mission.

In a statement this evening, Khazanah said that it was “seeking further clarification as necessary from the government and other respective parties”.

“This is with a view towards clarifying, reaffirming and implementing our mandate as the strategic investment fund of the government of Malaysia,” the statement read.

Earlier today, Prime Minister Dr Mahathir Mohamad said that the government would reorient Khazanah, as it had strayed from its original mission.

The prime minister, who is also chairman of the fund, said Khazanah was originally intended to hold shares allocated to Bumiputeras, under the former affirmative action policy to increase Bumiputera equity in the stock market.

“But along the way, Khazanah decided that it should take on the shares for itself. Why not buy if there are good shares at the time of listing when the price of shares was very low,” Dr Mahathir said in an interview with business website Investvine.

“So, they forgot entirely about holding the shares for the Bumiputera. They decided on holding the shares forever as part of the (stable of) government companies.  

He also said Khazanah was making unsound investments instead of contributing to the Bumiputera economy.

“It is quite obvious they are doing all kinds of funny things like buying houses and taking over companies.

“Khazanah was initially formed to buy up shares allocated to Bumiputeras because Bumiputeras, when they buy, they sell immediately to others.

“To stop them (Bumiputeras) from doing that, we formed Khazanah. Now, they seem to be taking up all shares, all on their own, whether they are meant for Bumiputeras or not.

The Pakatan Harapan administration is reviewing all the shares Khazanah owns with a view towards reorienting the fund to its original intention of holding Bumiputera equity.

“We will categorise (the shares) into ones that are profitable, the ones that are maybe profitable and the ones that are losing.

“We need to get rid of some of these companies to reduce their number and to certain extent, to go back to (Khazanah’s)  original intention of holding the shares allocated for the Bumiputeras until such a time as they can buy them,” said Dr Mahathir. – July 6, 2018.