And it is no longer RM42 billion but RM33 billion because some of those loans have already pelaburan forex dalam islam hutang repaid. And that RM33 billion in bank loans is backed by more than RM60 billion in assets. And some of those assets are now in various stages of development and would be worth more than its original value.
Either Mahathir does not understand the fundamentals of business or he was downright lying and thought he could get away with it. Prime Minister Tun Abdullah Ahmad Badawi in 2008. Hence the opposition spin that it was Prime Minister Najib Tun Razak who set up 1MDB in 2009 so that he could syphon out government funds is not true. In short, for every RM1 in loans, 1MDB has RM2 in assets.
So how can 1MDB be considered bankrupt? It would be considered bankrupt if it has RM1 in assets for every RM2 in loans. Now it is the other way around. It has RM2 in assets for every RM1 in loans. One criticism they raise is that those RM60 billion or more worth of assets had been procured at below market price and not at prevailing market price. That, of course, is a debatable subject.
Kelantan, Penang and Selangor — have been procuring assets at what can be considered below market price. Bank Negara, PNB, LTAT, Tabung Haji, Pernas, Felda, the various SEDCs all over Malaysia — in fact, hundreds of such trust agencies and GLCs have been given land, licences, permits, and public company shares at par value and not at listed price. Ask ex-Pakatan Rakyat Selangor Menteri Besar Khalid Ibrahim how it was done when he was heading PNB since way back in the 1980s. So, this is not special to 1MDB. It is normal for all trust agencies and GLCs all over Malaysia, even for the Pakatan states.
It is how the government does business since the 1960s when Tunku Abdul Rahman was Prime Minister. GLCs because the non-Malays were using Malays to buy these pink forms and were making millions. After a silence of more than a year they are resurrecting this matter. RM42 billion after a hiatus of more than a year? This week they had a meeting and they came to the conclusion that Pakatan Harapan is in trouble.