Bank Negara will look into reopening 1MDB case if new data surfaces

  • May 17, 2018
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Following renewed interest in 1MDB, Bank Negara Malaysia governor Muhammad Ibrahim said the institution would look into reopening its investigation into the state investment fund if it receives any new related information.

He also explained that the central bank had previously taken all necessary and viable actions under its jurisdiction against 1MDB, such as fining the state fund.

"We have actually exhausted all investigations on this particular entity. In fact, some of the actions we can take under our law, we have taken.

"Those which are not under our law, we have given all the information and data to relevant authorities and agencies.

"Whether we will reopen the case, if there is any new data or information that we did not know of before, we will certainly look at it again as we get more cooperation and data from the entities," he said during a press conference at Bank Negara today.

Muhammad also expressed confidence that they would be able to obtain more information and more transparency when dealing with 1MDB entities under the new administration.

Once more information had been gathered on 1MDB, he said Bank Negara would be able to make an assessment of how much money could be brought back to Malaysia.

Pointing to all the actions Bank Negara has taken against 1MDB, he stressed that the central bank has always been very objective in this matter.

"The fact that we have taken action against parties involved and we have basically given all the information and data to all relevant parties for further action shows that we are looking at this matter very objectively, and we are following the letter of the law," he said.

Muhammad was responding to a question on whether the central bank had received any pressure from the previous regime with regards to 1MDB.

The new Pakatan Harapan administration, as led by Prime Minister Dr Mahathir Mohamad, had said that they would implement institutional reforms of key institutions, including the central bank.

Muhammad explained that the central bank had already undergone reforms with the new Central Bank of Malaysia Act 2009, which replaced the previous act of the same name of 1958.

The 2009 act provided Bank Negara with more independence and transparency, he said.

However, he said they welcomed any new reforms that could improve the central bank as "reform is continuous".

"At the central bank, we always renew ourselves from time to time," he said.

Ensure enforcement of zero-rated GST’

Muhammad also commented on the new government's announcement about GST being zero-rated beginning in June.

He said Bank Negara expects prices of goods and services previously taxed under GST to decline, and stressed that it is very important for businesses to pass this onto consumers.

"On top of that, the relevant authorities should ensure that enforcement is done to make sure that consumers benefit from the reduction of GST from six to zero percent," he said.

Most likely, he said, the zero-rated GST would also have an impact on inflation but it is too early to calculate right now.

Regarding the ringgit, Muhammad said the currency saw some volatility right after the general elections, but that it stabilised very quickly afterwards.


 


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