‘I will resolve 1MDB issue’

KUALA LUMPUR: Bank Negara’s outgoing governor Tan Sri Dr Zeti Akhtar Aziz has promised to use her remaining 38 days in office to resolve the 1Malaysia Development Bhd (1MDB) issue before handing over the reins to her successor.

“I want closure on the 1MDB case, as I want the new governor to start with a clean slate ... and not have to deal with the matter that happened during my time,” Zeti said.

The central bank has commenced administrative enforcement actions against 1MDB for failure to submit documentary evidence pertaining to the state fund’s inability to re­patriate the US$1.83bil (RM7.16bil) it had used abroad.

In relation to the central bank’s action against 1MDB, Dr Zeti said the Federal Government-owned fund had not fully complied with the central bank’s directive on repatriating the funds.

“So we are pursuing appropriate administrative enforcement action as allowed to us by the laws under which Bank Negara operates,” Dr Zeti told reporters after her last presentation of Bank Negara’s annual report here yesterday.

1MDB, in an immediate response, reiterated that it had fully cooperated with the central bank in the past 12 months.

“We highlight that 1MDB has fully cooperated to the extent possible with Bank Negara’s investigations, including providing documentary evidence where available.”

Bank Negara had, in August 2015, revoked three permissions granted to 1MDB under the Exchange Control Act 1953 (ECA) for investments abroad totalling US$1.83bil (RM7.3bil) and issued a directive under the Financial Services Act 2013 to 1MDB to repatriate the sum to Malaysia.

The central bank also recommended criminal action against 1MDB.

But in September last year, the Attorney-General (A-G) cleared 1MDB of any wrongdoing, and said no further action should be taken against the debt-ridden fund.

Zeti conceded that the proposed administrative enforcement actions, which could result in either a penalty or compound against 1MDB, would still require the A-G’s endorsement.

Zeti, who officially retires at the end of April after 35 years with the central bank, also outlined the quali­ties of her successor.

She said the next central bank chief would need to command the respect of the people and the markets besides having to manage mone­tary and financial stability at a volatile time for the global economy.

“Not anybody can be appointed to the position,” she said, adding that candidates must have extensive knowledge, especially in the current volatile economic environment.

Several names have emerged as possible successors, with Bank Negara’s most senior deputy governor Datuk Muhammad Ibrahim, a career central banker, reckoned as the internal candidate of choice.

Besides him, the names of three others have been speculated as possible successors – the Minister in charge of economic planning in the Prime Minister’s Department Datuk Seri Abdul Wahid Omar, Malaysian ambassador to the United States Datuk Awang Adek Hussin, and the secretary-general of the Treasury at the Finance Ministry Tan Sri Mohd Irwan Serigar Abdullah.