Malaysia will have to fork out an estimated RM34.6 billion to service debts generated by 1MDB over the next five years, according to Maybank Kim Eng Securities.

According to Star Online, the firm said debt servicing, both coupon and principal, will approximately be RM1.7 billion in 2019, RM1.7 billion in 2020, RM2.7 billion in 2021, RM15.4 billion in 2022 and RM13.1 billion in 2023.

1MDB was set up by Putrajaya in 2009 soon after Najib Abdul Razak became prime minister.

It was first intended as a sovereign wealth fund but quickly racked up RM42 billion in debts and faced cash flow problems in 2015. 

Despite claims by the Najib-administration that a rationalisation process was taking place, the Pakatan Harapan administration had revealed that 1MDB's debts were being serviced, quietly, by the federal government.

Much of 1MDB's debts were raised from bonds, of which three were in US dollars.

According to Maybank Kim Eng Securities, the full crystallisation of some of 1MDB's debts has become highly likely.

The firm said some options for Putrajaya were to buy back the bonds in US dollars from the open market, such as 1MDB Global Investment's US$3 billion bond.

Maybank Kim Eng Securities said that this bond was currently trading at 89 percent of par.