Anwar Ibrahim said he would have to resign as finance minister if the actual figure in relation to Bank Negara's foreign exchange (forex) losses is revealed, claimed a witness.

Testifying before the Royal Commission of Inquiry (RCI) on the forex losses, former Bank Negara assistant governor Abdul Murad Khalid said Anwar had confided this to him.

Reading his witness statement, Murad said in 1994, then Bank Negara governor Jaffar Hussein had instructed him to explain the forex losses to Anwar, who was then finance minister.

At the time, Murad, who revealed earlier this year that the losses amounted to US$10 billion, was Bank Negara's advisor.

"Anwar asked me to join him on his flight to Hawaii to provide an explanation on the forex losses, as instructed by Jaffar," he told the commission.

After explaining the matter to Anwar, Murad said the latter replied that he understood the issue and would discuss it Jaffar.

"Apart from that, after I explained, Anwar commented that should the true figure of the forex losses be revealed to the public, he would have to resign as finance minister,” he added.

This morning, the RCI's first witness, former Bank Negara staff Abdul Aziz Abdul Manaf, told the commission that the central bank lost RM31.516 billion from 1991 to 1994.

Meanwhile, Murad had earlier told the RCI that he had discussed the matter with Jaffar sometime in May or June 1992 in London.

"I told the (then) governor that during my visit to the Chemical Bank in New York, I was told that Bank Negara's losses in foreign exchange with their bank were around US$170 million.

"However, the governor did not believe me and reprimanded me and told me to discuss the matter with (former finance minister II) Nor Mohamed Yakcop."

Murad claimed that there were others present when he told Jaffar about the forex losses.

They were former ambassador to the United States Awang Adek Hussin, former Bank Negara governor Zeti Akhtar Aziz and Jaffar's wife Rohila Abdul Rahman.

Murad, however, said that Jaffar was not in the know of the magnitude of the forex losses.

Governor didn't know anything is 'odd'

RCI member Saw Choo Boon nevertheless said that Murad's statement that the governor did not know anything was "odd".

Sidek, too, said that he finds this odd.

"Losses of US$170 million. It happened in the house yet (others) don't know. I find it odd.

"In the government, if any of the secretaries-general were to lose government money of RM1.7 million, I'll hang the guy.

"However trusting I am of somebody, if I was there, I would go and correct it."

Sidek also found it strange that the governor and other senior officers did nothing to rectify the matter for years.

"Then you told us you went to Hawaii in 1994 accompanying the minister of finance, and that's it. I cannot reconcile it.

"I'm saying this because I still have the national interests at heart, that's why I want to know the truth," added Sidek.

The RCI is expected to complete its probe within three months from the date of its setting up on July 15 and thereafter submit its report to the Yang di-Pertuan Agong.

It has been tasked with determining the veracity of allegations surrounding the forex losses incurred by Bank Negara and its implications on the national economy.

It will also determine if Bank Negara's involvement in forex activities contravened the Central Bank Ordinance 1958 or other related laws.

Finally, the RCI will decide whether there were attempts to conceal facts and information regarding this as well as the issuance of statements which misled the cabinet, Parliament and public.

The forex scandal occurred during the 1980s when Dr Mahathir Mohamad was prime minister, prompting certain quarters to accuse Prime Minister Najib Abdul Razak of attempting to exact political revenge against his nemesis.

Kiniguide: Unearthing the 25-year-old forex scandal