YOURSAY ‘Would 1MDB be able to raise billions without the gov’t guarantee?’
MP: 'Financially stretched' 1MDB misses 3 deadlines
Fair Play: Petaling Jaya Utara MP Tony Pua, perhaps you should have raised your question to both the Securities Commission (regulator of public-listed companies) and the Companies Commission (regulator of all companies formed under the Companies Act 1965).
Their answer, or the lack of it, might shed some light.
Mushiro: So early into its loan period and 1Malaysia Development Bhd (1MDB) is already showing signs of stress - having to reschedule its loan payment period and unable to pay up on deadlines.
It will not be long before worse nightmares set in for 1MDB. But then PM Najib Razak has no worries - the government which has guaranteed the loans will be paying. The rakyat suffers and the cronies make tonnes of money.
Shawkey Ghafur: Delay in loan repayment and forfeitures are common in business world. This doesn't mean that this government-linked company (GLC) is on the brink of bankruptcy.
A little financial adjustment would help 1MDB to resurface again. Pua is simply blowing this debt issue out of proportion to hoodwink the ignorant public.
Alexis70: Indeed, when you invest for the long-term, you should not panic about loan repayments although it may take time to do so. After all, 1MDB is a long-term economic development company.
Pua, we understand you tend to give negative perceptions about 1MDB even though you understand the benefits of the formation 1MDB.
SMC77: Yes, it is perfectly normal for corporations to reschedule their loans due to changes in their capital structure and funding plan.
What is not normal however is that only 1MDB and the selected few dodgy GLCs get to enjoy government guarantees. Would 1MDB be able to raise billions without the guarantee from Malaysian government?
The answer is pretty clear. Even the mighty Goldman Sachs will not be able to help 1MDB raise funds without a guarantee from the Malaysian government.
With the halo effect of Malaysian government's guarantee, it is pretty unusual for them to reschedule loan especially when they can use the guarantee to borrow money from any banks (if they still believe the credit worthiness of the Malaysian government) to settle the debt on time.
This also reveals the third-class financial management and planning of 1MDB as most corporations of similar size would be very diligent in managing their borrowings, especially the loan repayment schedule.
Alexis70, can you explain why 1MDB is carrying out the so-called long-term economic development as a private company?
If it is for long-term development, why can't the government carries out this as a social development instead of setting up a private company held by the Finance Ministry to do it?
Don't bullshit with the term "long-term development" and that it takes time for making profit, etc. First of all, the government is not supposed to "make" money and compete with the private sector.
Second, the long-term development can be carried out in many forms. Setting out 1MDB to carry such questionable economic development is clearly a waste of precious government resources, especially since the guarantee given by the Malaysian government would inevitably impact its borrowing headroom.
Hulubalang: No charges were absurd as saying that 1MDB has taken most of the country's wealth and use it for commercial purposes. This is a very wrong statement.
This is because 1MDB never stated that what used to be the country's investment comes from the property of the state. It’s also never claimed to be an agent or intermediary for any party using state funds.
1MDB is a body that comes from Terengganu Investment Authority. After it was taken by the federal government, it became a national entity. Basically 1MDB is a company fully controlled by the Malaysian government.
SRMan: 1MDB has three tendencies:
1) Overpaying to buy assets
2) Overpaying fees to raise money
3) Submitting financial accounts often beyond the mandatory deadlines
These 'strange habits' certainly do not exude confidence or bode well for a company staffed with professionals and having been established more than five years. And having amassed a huge debt of RM42 billion within such a short period with nothing much to show, we the rakyat should indeed be worried.
As we all know, failures of GLCs or government business entities are not something unheard of in this country. In fact, they are quite common. For all we know, the debts owed could roll on to our next generation.
Hope abounds: If you are a shareholder in the company facing this scenario, will you ask the CEO (chief executive officer) to step down, or shall you wait till the company goes bust?
Mamba: I hope Umno people really sit up and confront Najib on this 1MDB issue. Noises from oppositions are not that powerful. An internal revolt against Najib can only tackle this cancer that will kill our economy.
I believe very few Umno people reap benefits from this fund. The gravy train has to stop somewhere or else Umno will be swept away in next general election (GE).
Anonymous #19098644: Pua, what would be the losses of 1MDB minus the three revaluation surpluses in three years?
Based on the unadjusted figures, what would the tangible assets then be? In the event of insolvency, what would the net loss that the taxpayers have to pay? We need to know.
Hmmmmmmmm: Surely this can’t be true. Even the Dutch PM envies us .
Anon1: Would it be a good time now to rename 1MDB to ‘1Malaysia Dah Bankrap’?
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