PUTRAJAYA: 1Malaysia Development Berhad (1MDB) has confirmed that it is unable to service its debt obligation which is due this May 30.
Finance Minister Lim Guan Eng said this was told to him by the fund's director at a meeting.
Lim met with 1MDB chief executive officer Arul Kanda Kandasamy and two of its directors, Datuk Norazman Ayob and Datuk Kamal Mohd Ali today.
Arul Kanda was accompanied by former 1MDB chief financial officer Azmi Tahir and former 1MDB legal adviser Ivan Chen.
The meeting, according to Lim was to find out the status of 1MDB's finances, especially on its ability to pay its debts.
Yesterday, Lim informed that RM143.75 million was due to be paid by 1MDB to lenders by May 30.
Following that, Lim said he had instructed Arul Kanda to brief him and clarify if 1MDB was able to pay the sum due next week.
"I was shocked to find that the first document I needed to sign after starting work is a document for the payment of 1MDB's debt due end of this month. I did not sign it yet as I wanted to meet with the management of 1MDB first," Lim told reporters at a press conference after the meeting, here.
Meanwhile, Lim said Kamal had described the sovereign fund's investment as a 'scam'.
"Both 1MDB directors confirmed that 1MDB is ‘insolvent’ and can't pay its debts.
"Former CFO Azmi wrote to the ministry in March to inform that 1MDB could no longer service its interests due in April and May," Lim said.
"However, when Arul was asked about this, he informed that he is currently on leave until his contract ends next month. Therefore he claims he does not know the company's financial status," Lim added.
Reporting by Ooi Tee Ching and Hazwan Faisal Mohamad