KUALA LUMPUR: 1Malaysia Development Bhd's (1MDB) assets transfer to Ministry of Finance Incorporated (MoF Inc) will likely be completed by mid-June, says Deputy Finance Minister Datuk Johari Abdul Ghani.
The company, he said will then become a shell company to manage liabilities and bonds it has used.
"The ministry has also decided that 1MDB is no longer allowed to make borrowings from any institutions and has to serve its liabilities and manage bonds through whatever means.
“The business model is no longer sustainable. You cannot continue to do business using this model anymore and that is the reason why they cannot borrow anymore.
“The assets transfer process is ongoing. By end of this month or mid June, we will be able to resolve all this," he told reporters at the Parliament lobby today.
Johari also said the value of the transferred assets were expected to increase and is sufficient to cover all of 1MDB's liabilities including bond commitments.
He added that 1MDB is slowly carrying out a retrenchment process for its staff, adding that some had already submitted their resignation.
On the closure of BSI Bank Ltd's operations in Singapore, Johari said it would not have any impact on 1MDB's operations.
He said 1MDB does not have many dealings with the bank.
The Monetary Authority of Singapore announced yesterday that it has ordered the closure of Switzerland's BSI Bank in Singapore.
1MDB clarified that it had not been contacted by any foreign lawful authority on matters relating to the company but confirmed that its ownership of various fund investments had not been impacted by the announcements.