Ganesh Sahathevan

by Ganesh Sahathevan Prime Minister and Minister For Finance Najib Razak provided this carefully worded response to  Parliament this week, in answer  to a question from Tony Pua MP ,who asked if 1 MDB owed the International Petroleum Investment Corporation (IPIC) US$ 481 million: “Notes in the 1MDB financial report ended March 31, 2014, clearly state that no such amount  was borne by 1MDB from IPIC,” said Najib, who is also the prime minister. Najib said any party had the right to determine the method of reporting their financial statements. (See story below) The choice of words is interesting in that the notes to the accounts do not anywhere say," no such amount  was borne by 1MDB from IPIC". It would be curious if there was such a statement.Unless there is some obvious dispute, one would not find a note denying a liability. However, the notes do disclose a transaction with IPIC's wholly-owned subsidiary Aabar,and what is disclosed ought to be of greater concern to Najib

by Ganesh Sahathevan The extract at the link below from the Economic Report 2015-2016 details the position of the Malaysian Government's Non-Financial Public Corporations (NFPC,formerly NFPE). The financial position of the NFPCs are incorporated in full  into the national accounts,and comprise a major chunk of the total public sector debt, asset and income position. By its own definition the Malaysian Government ought to have included  1 MDB in the public accounts but did not.It is as if the company does not exist.  Given the magnitude of that entity's  borrowing, debt defaults,and likely contingent liabilities, the 2016 Budget announced on Friday is a worthless document.. http://www.treasury.gov.my/pdf/economy/er/1415/jp6_13.pdf

by Ganesh Sahathevan Santos Ltd has been made an offer it can refuse by something called the Scepter Syndicate. Media reports  says of Scepter: Scepter described itself as a “syndicate of ultra-high-net-worth industrialists and sovereign wealth funds with offices in New York and representative offices in London and Beijing’’. Its members include United Arab Emirates royalty and businessman Sheikh Juma al Maktoum, Brunei’s Prince Abdul Ali Yil Kabier and businessman Rayo Withanage , who is of Sri Lankan and Portuguese descent. The company is being represented locally by corporate adviser Ian Smith from the high powered lobbying firm Bespoke Approach. Bespoke has previously worked for Santos. Scepter sounds too much like another high-flying Middle East oil rich royal family company called PetroSaudi, which as it turned out, did not really have very much in fund s at all. As readers will note from the links provided above and the story below, Messrs Kabier and Withanage are not exactl

Comment Dagong is in essence China's answer to Western rating agencies.The choice of language is probably indicative of Chinese Government perceptions of Malaysia's politics and economy. Dagong Downgrades the Sovereign Credit Rating Outlook of Malaysia to Negative Time：2015-10-13   Source：dagong   Editor：   Print   Font Size：  Big   Normal   Small   Click Rate：30 Dagong Global Credit Rating Co., Ltd. October 13, 2015 Dagong Global Credit Rating Co., Ltd. (hereinafter referred to as “Dagong”) decides to downgrade the outlook to the sovereign credit ratings of Malaysia to negative, while maintaining the local and foreign currency sovereign credit ratings at A+. The debt repayment environment of Malaysia has witnessed deterioration to a certain extent. In addition to the decelerating economic growth in the short term, the rising financing cost and heightening external liquidity risks will pose a challenge to the government’s debt repayment capability and make it confronted with do

by Ganesh Sahathevan MH 17's flight path was analyzed and presented on this blog to show that there was an unexplained  statistical anomaly in that other airlines including SIngapore Airlines were far more frequent users of the reported flightpath but only MAS had come to grief. It was speculated then that MH 17 had diverted off the normal route,and had made itself a target. That speculation has now been confirmed, and reported last night  on the ABC's 7.30 Report : CONOR DUFFY: Malaysian Airlines is also accused of culpability and a separate court action is already underway. The airline refused to fully cooperate with the Dutch investigators. JEROME SKINNER: The contribution of Malaysia Air is that they were a little bit off-track, they were low because of traffic in the area and they were slow because of traffic in the area, so when they entered directly over that zone of hostility, they would have appeared to be something other than what they were. END MH17:Statistics sugges

by Ganesh Sahathevan The new attorney general, the former justice of the Federal Court Yang Amat Arif Tan Sri Mohamed  Apandi Ali has clarified the basis of the charges against the alleged economic saboteurs, Khairuddin Abu Hassan and his lawyer, Matthias Chang.He has in a press release on the matter provided this explanation: Section 124L, of the Penal Code provides that ‘Whoever attempts t commit sabotage or does any act preparatory thereto shall be punished with imprisonment for a term which extend to fifteen years.’ In this regard, section 130A of the Penal Code defines the term ‘sabotage’ to mean an act or omission intending to cause harm, among others, to the maintenance of ‘essential services’ while the term ‘essential services’ is defined to include banking and financial services. It is obvious that statements and acts by the  likes of Moody's and other rating agencies fall within the ambit of the above sections. Being international rating agencies they clearly do m

UPDATE  The following has been extracted from the 1 MDB website and has been posted under their heading    Facts in relation to blog posting entitled “More Investments by 1MDB” by Tun Dr. Mahathir Mohamad  : In September 2012, 1MDB sold its shares in PetroSaudi Oil Services Limited for USD2.318 billion and received fund units in a Cayman registered fund. The Cayman registered fund is managed by Bridge Partners, a Hong Kong-based fund manager. These fund units were owned by 1MDB via its 100% subsidiary, Brazen Sky, and held through BSI Bank Singapore as custodian. As has been reported ,the Cayman fund was only registered and licensed on 15 November 2013. by Ganesh Sahathevan The Cayman Islands Monetary Authority's records show that the fund in which 1 MDB invested some USD 2 billion did not exist ,or was not registered , on the date the transaction is reported to have taken place. 1 MDB is reported to have invested USD 2,2 billion in Bridge Global Absolute Return Fund SPC segreg

by Ganesh Sahathevan Sarawak Report's revelation that 1 MDB CEO Arul Kandasamy had misled its board  about the existence of cash turned units at a bank in Singapore contains this interesting snippet : The CEO had told his bemused board members that Deutsche Bank was preventing him from repatriating the money, because they were demanding that he keep the Singapore cash account as collateral for another almost identical sum of US$975 million they had loaned to 1MDB . Readers will be aware that Deutsche Bank has since demanded  and received  early repayment of that loan,and that 1 MDB had to go cap in hand to IPIC for some USD 1 billion to meet the Deutsche Bank demand. Readers will also be aware that r eports about Deutsche's concerns disclosed that Deutsche lead a syndicate of banks that included Arul's employer, Abu Dhabi Commercial Bank   : A consortium of banks led by Deutsche Bank has asked for their US$975mil loan to be repaid by 1Malaysia Development Bhd (1MDB) less

by Ganesh Sahathevan     This paragraph is from the 1 MDB press release issued yesterday:    The remaining US$940 million of fund units, are guaranteed by Aabar and have been ear-marked for a “debt for asset swap” with its “AA” rated parent, IPIC, as part of the 1MDB rationalisation plan.     That IPIC would consider  1 MDB's Cayman  "units"   assets  beggars belief given that the only value those "units" have derives from the guarantee IPIC itself has provided (via wholly owned subsidiary Aabar). To believe that IPIC would accept those units  as repayment of a debt owed to it by 1 MDB one must partake of  the magic mushrooms that 1 MDB's CEO and senior management seem to be consuming in copious quantities. To accept that IPIC's and 1 MDB's auditors would recognize the so-called “debt for asset swap” in the terms described by 1 MDB as a transaction that can be recognized in their books is to imagine that  the auditors have a d