KUALA LUMPUR, May 14 — Takaful Malaysia said today that it bought a RM85-million Islamic bond, or sukuk, from the Terengganu Investment Authority (TIA) — the predecessor to 1 Malaysia Development Berhad (1MDB) — in 2009 that was guaranteed by the government.
News portal The Malaysian Insider reported Takaful Malaysia group managing director Datuk Seri Mohamed Hassan Md Kamil as saying that the bond was purchased at a coupon rate of 5.25 per cent that will mature in 2039.
“It is guaranteed by the government, we believe it's quite safe,” Mohamed Hassan was quoted saying.
“The reason we bought the bond at that time was because of its 30-year tenure. As you know, maturity like this is long term and we are required to match our assets and sukuk was the only issue at that time with such a long time,” he added.
He said the sukuk posed a “very small exposure” to the company’s finances as it represented about 2 to 3 per cent of its total asset base of RM7.1 billion.
1MDB was incorporated in 2009, after the prime minister announced the decision to turn the TIA state fund into a federal agency.
Permodalan Nasional Berhad denied yesterday an allegation that it purchased sukuk bonds from the debt-laden 1MDB.
PKR secretary-general Rafizi Ramli demanded Putrajaya Tuesday to explain what happened to some RM3.5 billion in funds raised by 1MDB through loans and Islamic bonds over the past four years for its Bandar Malaysia project.
According to Singapore’s Business Times, lenders spooked by the controversy surrounding 1MDB are contemplating demanding the full settlement of a US$975-million (RM3.6 billion) loan ahead of its due date in August.
More worrying for the state-owned investor is that the consortium led by the Deutsche Bank Singapore could trigger cascading defaults on the remainder of 1MDB’s reported RM42 billion debt if they declare the firm to be delinquent.
