1MDB still owes billions

1MDB still owes billions

As of the end of June 2021, 1MDB’s total outstanding debt stood at RM32 billion and as of September 2021, a total of RM12.8 billion of its financial commitments and debt servicing had been paid up through loans and advances from the government or Ministry of Finance (MoF) Inc.

This amounts to nearly RM10 billion. Some of the payments were made from the as well as utilisation of the Trust Account.

The Trust Account’s outstanding balance, which also earns placement profits (hibah), is currently sufficient to cover 1MDB’s obligations through 2022, according to the finance ministry’s 2022 Fiscal Outlook and Federal Government Revenue Estimates report, which was released on Friday.

1MDB’s outstanding financial obligations totalled RM39.3 billion, which included both principal (RM32.2 billion) and interest or profits on the debt (RM7.1 billion).

In 2009, the now-defunct 1MDB was formed as an MoF Inc company to spearhead strategic development in the country.

However, its reliance on debt capital and poor corporate governance caused cash flow issues beginning in late 2014, necessitating government assistance.

“A total of RM18.2 billion in assets associated with 1MDB have since been seized or recovered and placed in the Assets Recovery Trust Account under the custody of the Accountant-Department,” General’s the financial institution said.