KUALA LUMPUR, May 28 — Datuk Seri Najib Razak’s former special officer had in 2011 personally handed over a letter for a RM3.95 billion loan application from 1Malaysia Development Berhad’s (1MDB) subsidiary SRC International Sdn Bhd, a former Retirement Fund Incorporated (KWAP) CEO said today.

Datuk Azian Mohd Noh, who was CEO of civil servants’ pension fund KWAP from March 2007 to March 2013, said the 2011 letter had contained Najib’s handwritten note of approval.

Azian, 66, said she had in June 2011 received the letter directly from the late Datuk Azlin Alias, who was then the special officer for ex-prime minister Najib.

"I know the late Datuk Azlin Alias as the prime minister’s special officer as I had dealings with him previously,” she told the High Court today.

Azian said Azlin’s office had contacted her to meet him at the lobby of a hotel in KL Sentral in Kuala Lumpur, and that she had done so at night after office hours.

"There, I received the letter by hand from the late Datuk Azlin Alias. I confirm receiving the original letter from the late Datuk Azlin Alias.

"I was informed by the late Datuk Azlin Alias that the prime minister at that time, namely Datuk Seri Najib has agreed with the proposed application from SRC and I was referred to the note on the letter which Datuk Azlin Alias informed had been made by Datuk Seri Najib himself,” she said.

Azian is the 38th witness for the prosecution in Najib’s trial over charges of abuse of position, criminal breach of trust of RM42 million of SRC International Sdn Bhd’s funds.

Azian said the letter she received in June 2011 was signed off by SRC International director Nik Faisal Ariff Kamil, with the letter addressed to Najib as the prime minister and finance minister then.

Azian said the letter to Najib was SRC International’s letter to apply for a RM3.95 billion loan from KWAP for the purposes of working capital and general investment.

"On the letter dated June 3, 2011, there was a handwritten note and the signature of prime minister Datuk Seri Najib that was addressed to me as KWAP CEO and stating ‘Agree with this proposal’ and dated June 5, 2011.

"According to my understanding, the note ‘Agree with this proposal’ meant the prime minister agreed for KWAP to give the loan to SRC,” she added.

Azian, who said she had known Azlin for about two years prior to that, said it was the first time she had met with the prime minister’s aide outside of working hours.

Azian said SRC International’s loan application — via the letter that was addressed to Najib as the prime minister — did not meet the requirements of KWAP’s procedure and KWAP’s loan policy.

While confirming that she read the letter’s content during the brief June 2011 meeting lasting about 45 minutes, Azian said she could not immediately determine then whether it fulfilled KWAP’s policy and procedures.

"Of course it’s impossible for me to decipher the contents at that moment. I took the letter and took it to office. The moment I received the letter, of course I can’t decipher the contents in detail because it was at night,” Azian said.

Azian confirmed she did not subsequently tell Azlin that the SRC International’s letter did not fulfill KWAP’s loan policy, but said she could not recall why this was not done.

Azlin and five others had died in an April 2015 helicopter crash in Semenyih.

Datuk Seri Najib Razak arrives at the Kuala Lumpur Court Complex May 28, 2019. — Picture by Shafwan Zaidon

Throughout her testimony today, Azian made multiple mentions of Najib in relation to SRC International’s attempts to borrow money from KWAP.

After receiving the June 2011 letter from Azlin, Azian said she had the next day met with KWAP chairman Tan Sri Wan Abdul Aziz Wan Abdullah to inform him of SRC International’s letter that sought for a loan of RM3.95 billion.

"Tan Sri Dr Wan also said that he knows of the matter as he was personally told by Datuk Seri Najib previously,” she said, adding that the KWAP chairman then instructed that the pension fund evaluate the loan application and present it for KWAP’s investment panel to consider and decide on.

Azian said KWAP’s fixed income department had then prepared a proposal for a loan of only RM1 billion, instead of the RM3.95 billion amount sought by SRC International due to multiple risks such as repayment risk and overconcentration of risks in one company.

Azian said that a KWAP investment panel member had in a July 5, 2011 gave the opinion that Najib be informed that only a RM1 billion loan amount was proposed, which resulted in Wan Abdul Aziz bringing her along to meet Najib at the Prime Minister’s Office.

When asked why Najib had to be updated on the matter, Azian said: "In my opinion, the matter has to be notified to Datuk Seri Najib because the original letter that we received noted the loan amount of RM3.95 billion.”

KWAP’s investment panel later in a July 19, 2011 meeting considered a fresh internal proposal for a RM2 billion loan to be given to SRC International with tighter conditions including getting a government guarantee.

In the same July 19, 2011 meeting, Azian as the meeting’s secretary had informed the investment panel that the KWAP chairman was told by the prime minister that he "wanted KWAP to expedite the loan and that RM2 billion suffices”.

"The information was relayed to me by the chairman and the chairman instructed me to report to the investment panel during the meeting.

"Normally during the start of every meeting, I would be updating (panel) members of matters arising. So I was merely doing that to report what’s the latest on the matters arising,” she said, confirming that she could not recall when the RM2 billion loan request was made to KWAP.

After a protracted process that involved a third internal proposal, KWAP finally agreed to give a RM2 billion loan in late August 2011 to SRC International after securing a government guarantee for the loan, with the government guarantee letter signed by then Finance Minister II Datuk Seri Ahmad Husni Hanadzlah.

Witnesses previously testified that KWAP in 2012 gave a second RM2 billion loan to SRC International, again due to a government guarantee letter that was this time signed by Najib.

Azian today testified that SRC International had on March 13, 2012 asked for the second loan of RM2 billion, adding that the KWAP investment panel had considered the proposed RM2 billion loan in a March 20, 2012 meeting.

The recorded minutes of the March 20, 2012 meeting stated that the finance minister had approved SRC International’s application for a further loan and his advice for the company to seek for the additional loan from KWAP which had previously already lent RM2 billion, Azian said.

Azian is expected to continue testifying tomorrow.

At the time of the first loan application, SRC International was the wholly-owned subsidiary of 1MDB which was owned by the Finance Ministry’s Minister of Finance Incorporated (MoF Inc); while SRC International was parked directly under MoF Inc by the time of the second loan application.

The trial before High Court judge Mohd Nazlan Mohd Ghazali resumes tomorrow.