KUALA LUMPUR, Sept 2 — The Ministry of Finance (MoF) has paid nearly RM1.7 billion of scandal-plagued SRC International Sdn Bhd’s debts to the Retirement Fund (Incorporated) (KWAP), with the most recent transaction of over RM344 million last month.
Finance Minister Lim Guan Eng said as a guarantor to the RM4 billion loan made by the former 1Malaysia Development Bhd (1MDB) subsidiary, the government needs to ensure the pension funds could still function by not defaulting on the payments.
“The total payment made by the Ministry of Finance for SRC International Sdn Bhd now is RM1,691,822,628.05,” he said in a statement here.
“From that amount, the latest payment made on August 29, 2019 was RM344,681,265.07 including principal of RM300 million and interest of RM44,681,265.07.
“According to the payment schedule, the next date of payment on September 30, 2019 will involve amount of RM43,023,748.31 (interest),” Lim added.
Lim acknowledged that while the government is struggling fiscally, it will still ensure that enough funds be allocated to honour the debt schedule — which has a balance of around RM3.8 billion unaccounted for.
“The Ministry of Finance will make sure enough funds are allocated to service the payment to KWAP to prove Federal Government’s ability to manage (even when struggling fiscally) to manage financial burden of 1MDB and SRC inherited from the previous administration,” he said, referring to Barisan Nasional government.
On June 15, the 41st prosecution witness of the former prime minister Datuk Seri Najib Razak SRC trial, Afidah Azwa Abdul Aziz, told the court that SRC International owed KWAP RM4.15 billion after borrowing RM4 billion in 2011 and 2012.
The company, whose accounts were frozen in 2015, has defaulted on its loan payments in 2015, 2016 and 2017, and it had to obtain a loan from the government to prevent an event of default.
Afidah, who is the deputy secretary of the MoF’s strategic investment division, said the government then had to step in as it guaranteed the loan.
MoF took over SRC International from 1MDB in 2012, before taking a second loan from KWAP.
Najib is currently facing seven charges of abuse of position, criminal breach of trust and money-laundering over RM42 million of SRC International’s funds at the Kuala Lumpur High Court.
Justice Mohd Nazlan Mohd Ghazali who presides over the case has set November 11 to decide whether Najib will have to enter his defence or be released.
