Ex-KWAP CEO says met Najib to inform him of RM1b SRC loan offer

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

KUALA LUMPUR, May 28 — Former Retirement Fund Incorporated (KWAP) chief executive Datuk Azian Mohd Noh told the High Court today that she had met with Datuk Seri Najib Razak in 2011 to inform him of KWAP’s lowered loan amount to SRC International Sdn Bhd.

Azian explained that SRC International initially requested for a RM3.95 billion loan from KWAP, but the pension fund’s Investment Panel had during a panel meeting on July 5, 2011 only considered an internal proposal to lend RM1 billion.

She said the panel had in the same meeting then decided to defer the decision on whether to grant SRC International a RM1 billion loan.

“[During the meeting] one of the panel member, I could not recall who, then suggested that Datuk Seri Najib be informed of KWAP’s decision to propose a loan of RM1 billion only to SRC International.

“Thus, KWAP chairman Tan Sri Wan Abdul Aziz Wan Abdullah then informed me to accompany him to meet with Najib personally,” she said during her testimony here.

Azian is the 38th prosecution witness to take the stand in Najib’s RM42 million SRC International Sdn Bhd trial as the trial entered Day 19.

Azian then said she met with Najib along with Wan Abdul Aziz at the Prime Minister’s Office to inform him of the panel’s decision, however she conceded she could not remember the exact date of the meeting.

When asked further on why Najib had to be notified on the matter, Azian said it was because the initial letter KWAP received was for a RM3.95 billion loan.

The letter Azian was referring to was a loan application letter dated June 3, 2011 from SRC International addressed to Najib who was then Prime Minister cum Finance Minister requesting a RM3.95 billion from KWAP for the purpose of working capital and general investments.

At that time SRC International was a wholly-owned subsidiary of 1Malaysia Development Berhad (1MDB), which in turn was wholly-owned by the Finance Ministry’s Minister of Finance Incorporated (MoF Inc).

Asked why KWAP’s Investment Panel decided to defer the RM1 billion loan proposal instead of rejecting it outright, Azian said that this allowed KWAP’s Fixed Income Department (FID) to contact SRC International to request for further information.

“It is not uncommon that information trickles in. It is normal for us to request more detailed information if the panel so decides,” she replied to deputy public prosecutor Datuk Ishak Mohd Yusoff during examination-in-chief.

“Information comes in stages, it may not meet expectations of Fixed Income Department, they may contact potential borrowers to get more information,” she added.

KWAP’s FID had prepared the Investment Papers containing proposals for the lending of money to SRC International for deliberation by KWAP’s Investment Panel.

But instead of drafting a proposal for a loan of RM3.95 billion as requested by SRC International, Azian explained that the FID had prepared an Investment Paper for the panel to consider lending only RM1 billion after taking into account of “over-concentration” and payment risks.

Previously the 29th prosecution witness, then KWAP’s FID assistant vice-president Amirul Imran Ahmat touched on how KWAP had initially looked at offering SRC International a loan of only RM1 billion, following the lack of details surrounding investment plans and future business projections made available to them by SRC International.

Today marks the 19th day of the former prime minister’s trial on seven charges of criminal breach of trust, abuse of position and money-laundering over RM42 million funds belonging to SRC International.

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