KUALA LUMPUR: Former prime minister Datuk Seri Najib Razak asked Retirement Fund Incorporated (KWAP) to rush the approval for the RM2bil loan to SRC International Sdn Bhd in 2011, the court was told on Thursday (May 9).
Witness Azlida Mazni Arshad, KWAP's Legal and Secretarial Department vice-president, said she was informed of this in a special meeting chaired by KWAP chairman Tan Sri Wan Aziz Wan Abdullah.
"As the meeting secretary, I took the minutes and the CEO informed everyone at the meeting that the prime minister wanted the loan approval to be expedited and that the RM2bil loan was enough," she said.
The witness was reading from a witness statement on the 16th day of Najib's corruption trial involving RM42mil in SRC International funds here on Thursday (May 9).
KWAP had approved the loan of RM2bil to SRC International in 2011 before approving another loan of the same amount in 2012.
Azlida Mazni said in the same meeting, KWAP's Fixed Income Department proposed that SRC's loan conditions be tightened with additional conditions.
This included a guarantee from the government and a corporate guarantee from 1Malaysia Development Bhd (1MDB) as well as a "letter of comfort/awareness" from the Finance Ministry.
After the proposal was deliberated, the witness said that a special investment panel had opined that a RM2bil loan was too big for a RM2 start-up company (SRC International).
"Therefore, the panel members agreed for a loan of RM1bil as stated in the original proposal, which was discussed in a meeting on July 5, 2011," she said.
Azlida Mazni said the panel members were aware of the over concentration risk of such a big loan.
"They questioned the capabilities and competency of the SRC International management in getting involved in natural resources which needed high levels of expertise," she said.
The court had heard in previous testimony that SRC International wanted a loan to get involved in natural resources such as oil and gas, iron and steel and coal and uranium.
Azlida Mazni also said the panel members agreed that the loan should not be given in one lump sum but released on a staggered basis based on progressive reports from SRC International.
The hearing continues next Tuesday (May 14).