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The Ministry of Finance (MoF) has confirmed that the previous government had used funds from Bank Negara Malaysia and Khazanah Nasional Bhd to service debt obligations of 1Malaysia Development Bhd (1MDB). REUTERS

KUALA LUMPUR: The Ministry of Finance (MoF) has confirmed reports that the government of former prime minister Datuk Seri Najib Razak had used funds from Bank Negara Malaysia and Khazanah Nasional Bhd to service debt obligations of 1Malaysia Development Bhd (1MDB).

In a statement today, MoF said as stated in its press release on May 22, the ministry haf made payments on behalf of 1MDB amounting RM6.98 billion due to 1MDB’s inability to pay.

“This amount includes the payment made to International Petroleum Investment Co (IPIC) as part of the RM5.05 billion settlement agreement,” it said.

MoF said the sources for the payments made to IPIC and Aabar BVI on behalf of 1MDB included the redemption of redeemable cumulative convertible preference shares (RCCPS) by Khazanah amounting to RM1.19 billion.

Khazanah, in a statement, said it had no control over the utilisation of funds redeemed in the form of RCCPS by MoF.

Datuk Seri Najib Razak gestures as leaves the Malaysian Anti-Corruption Commission (MACC) headquarters in Putajaya. Pic by ABD RAHIM RAHMAT

MoF also said the sources of payments had also come from the sale of a 22.5ha piece of land in Kuala Lumpur to Bank Negara amounting to RM2.1 billion.

It was reported that the purchase of land, which is adjacent to Sasana Kijang, is for the purpose of relocating the central bank’s Global Islamic Finance University and the International Shari’ah Research Academy for Islamic Finance.

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