KUALA LUMPUR, March 12 — Following Putrajaya’s announcement, debt-laden state investment firm 1Malaysia Development Bhd (1MDB) said today that the award of a RM950 million standby credit facility was a loan on “commercial terms”.

1MDB claimed that the loan was awarded after 1MDB announced its specific plans for its key assets, which received Putrajaya’s full support, and is meant to ensure that the state-owned company is able to realise “maximum value” from its plans.

“The facility, of up to RM950 million, is being provided as a loan on commercial terms,” 1MDB group executive director Arul Kanda Kandasamy said in a brief statement.

“Any funds drawn would be used for clearly defined purposes as agreed with the Ministry of Finance.”

“We are confident that with this facility from the shareholder, the company is well positioned to effect its previously announced plans, and we are now focused on implementing these to achieve our stated aim of maximising value for all stakeholders,” Arul added.

Earlier today, Putrajaya confirmed it has allocated RM950 million in standby credit to 1MDB, amid criticism that it is a “bailout” for the debt-laden state investment firm.

Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah told Parliament that the funds will be extended to the firm as and when needed, and do not amount to RM970 million as reported earlier.

Later, in a news conference at the Parliament lobby, DAP MP Tony Pua called the standby credit facility — where 1MDB may withdraw money at any time it wishes — a “bailout” due to the alleged use of taxpayers’ money.

1MDB reportedly has RM42 billion in debts and had previously missed deadlines to pay off the interest on its debts.

1MDB, a brainchild of Prime Minister Datuk Seri Najib Razak, is currently the subject of an investigation by the Auditor-General’s (A-G) Department and in line for further scrutiny by Parliament’s Public Accounts Committee.

Inspector-General of Police Tan Sri Khalid Abu Bakar also announced this week that a task force comprising officials from the Attorney-General’s Chambers, the police and the Malaysian Anti-Corruption Commission will investigate all complaints against 1MDB.

He said the police probe would only commence if the A-G uncovers discrepancies or any indication of wrongdoing.