Good afternoon! Nadirah here, Wong Chen’s Research Officer, reporting from Parliament. Just an hour ago, Wong Chen issued a press statement with regards to the Finance Minister’s answer on 1MDB and Marstan Investment NV loan. The transcript of statement is as follows:
Did Marstan Loan Earn Tanjong RM198 Million? Was This Legal?
Marstan Investment NV (a subsidiary of Tanjong, a company controlled by TS Ananda Krishnan) gave a RM2 billion term loan to 1MDB in February 2015. The loan was due for repayment in April 2016.
The loan was repaid ahead of schedule sometime in April 2016.
I asked in Parliament why an early payment was made and what interests were paid to Marstan.
The Finance Minister replied that the early repayment was made because it had money from the Edra Global Energy sale. This answer still does not explain why repayment was made ahead of schedule. Why the apparent favouritism to Ananda Krishnan’s company? The Finance Minister also refused to give an answer on how much interests was paid.
From the PAC report, we note that the interest rate charged by Marstan was 8.5%. If the term loan is for 14 months, my simple calculation shows a payment of interests around RM198 million.
RM2 billion x 8.5% x 14 months/12 months = RM198 million.
My follow up questions now to the Finance Minister is how a legal obligation on the part of Tanjong to re-invest in 1MDB’s Powertek, instead netted RM198 million in interest earnings for Tanjong.
Another question is whether the loan is legal, and how is it that a non-bank foreign entity can charge interest at 8.5% to 1MDB, a MoF entity. I therefore ask the Finance Minister to explain if this loan is contrary to the provisions of the Financial Services Act.
YB Wong Chen
Member of Parliament for Kelana Jaya
19th May 2016