Malaysia dissolves 1MDB advisory board; takes over its assets
Malaysia's finance ministry said it also accepts the resignation of 1MDB's Board of Directors with a new board set to be appointed 'in due course'.
- Posted 04 May 2016 16:20
- Updated 04 May 2016 17:57
Parliament's Public Accounts Committee (PAC) last month had called for the 1MDB advisory board, chaired by Prime Minister Najib Razak, to be abolished, after a probe into alleged graft and mismanagement at the fund, whose debt in January had totaled about 50 billion ringgit (US$12.5 billion).
The finance ministry, which is the sole shareholder of 1MDB, said in a statement it would also comply with the PAC's recommendation to remove Article 117 and change all references of "Prime Minister" to "Minister of Finance", in the fund's company articles. Najib is also the finance minister.
Article 117 requires the prime minister's written approval for all of 1MDB's financial commitments, including investments, and matters such as the appointment of the board of directors.
Ownership in 1MDB's subsidiaries and land assets in Bandar Malaysia Sdn Bhd, TRX City Sdn Bhd, Air Itam and Pulau Indah will be transferred to the Ministry of Finance Incorporated, the ministry said.
It did not say what happens to the debt linked to these assets.
In its report, the parliamentary committee had slammed the board of state fund 1MDB for being irresponsible and urged a probe into its former chief executive, but stopped short of implicating Najib.
The ministry also accepted the resignation of 1MDB's Board of Directors, who had collectively stepped down after the release of the report.
New board members would be appointed to reflect the limited business profile of 1MDB, it said.
However, 1MDB president Arul Kanda will remain in his role until further notice, according to the statement.
"(Arul) will continue to focus on his specific mandate to implement the rationalization plan, which will include resolution of the recent contractual dispute with IPIC (International Petroleum Investment Co)," the ministry said.
Last week, 1MDB did not meet its deadline to pay a US$50.3 million coupon on a US$1.75 billion bond following a stand-off with Abu Dhabi sovereign fund IPIC, triggering cross defaults on some of its other bonds.
Board of Directors
YBHG TAN SRI DATO' SERI LODIN WOK KAMARUDDIN
Tan Sri Dato’ Seri Lodin is the Chief Executive of Lembaga Tabung Angkatan Tentera (“LTAT”, Armed Forces Fund Board) since August 1982 and the Group Managing Director and Deputy Chairman of Boustead Holdings Berhad, one of Malaysia’s oldest diversified conglomerates, since 1 July 1991 and 3 March 2010.
Prior to joining LTAT in 1982, he was with Perbadanan Kemajuan Bukit Fraser (Fraser’s Hill Development Corporation) as its General Manager from 1973 to 1982.
Tan Sri Lodin has extensive experience in not only managing a provident fund but also in the establishment, restructuring and management of business interests ranging from plantation, property, pharmaceutical, heavy industries, trading and industrial and finance and investment.
Tan Sri Lodin is the Chairman of Boustead Heavy Industries Corporation Berhad, Pharmaniaga Berhad and 1Malaysia Development Berhad. He is also the Deputy Chairman of Affin Holdings Berhad, and sits on the Boards of Affin Bank Berhad, Affin Islamic Bank Berhad, Affin Investment Bank Berhad, AXA AFFIN Life Insurance Berhad, Boustead Petroleum Marketing Sdn Bhd, MHS Aviation Berhad, The University of Nottingham in Malaysia Sdn Bhd, FIDE Forum and the Minority Shareholder Watchdog Group.
Among the many awards Tan Sri Lodin received to-date include the Chevalier De La Legion D’Honneur from the French Government, the Malaysian Outstanding Entrepreneurship Award, the Degree of Doctor of Laws honoris causa from the University of Nottingham, United Kingdom, the UiTM Alumnus of The Year 2010 Award and The BrandLaureate Most Eminent Brand Icon Leadership Award 2012.
He graduated from the College of Business Administration, The University of Toledo, Toledo, Ohio, United States of America, with a Bachelor of Business Administration and Master of Business Administration in 1972 and 1973 respectively.
President and Group Executive Director
Arul Kanda brings a wealth of experience in investment and senior management leadership roles.
He has extensive expertise in structured finance, corporate finance and restructuring across multiple markets including in Malaysia, the UK and the Middle East.
He joins 1MDB from Abu Dhabi Commercial Bank (ADCB), where he was Executive Vice-President and Head of Investment Banking, having previously worked in leadership positions at Barclays Capital and Credit Agricole.
He also served on the Board of RHB Investment Bank Berhad. Arul is a Board Member of Global Investment House (Kuwait) and Board Member/Investment Committee Member of the ADCB Macquarie Infrastructure Fund.
Arul is a UK-qualified Barrister, with an LLB from the London School of Economics and an LLM from University College London.
YBHG DATUK SHAHROL AZRAL IBRAHIM HALMI
Datuk Shahrol has over 13 years of experience in IT Transformation, IT Integration, Service-Oriented Architecture and complex system implementations involving large government-linked entities, government agencies as well as local, regional and global financial institutions. He has led key projects in Malaysia, including a multi-year transformation programme at the Employees Provident Fund as well as planning and executing the merger of Sime Darby, Guthrie and Golden Hope to form Synergy Drive, the world's biggest plantation company. He was also the Executive Partner of Accenture and Managing Director of the Public Service Group of Accenture Malaysia Sdn Bhd.
Datuk Shahrol is currently PEMANDU’s Director of Oil, Gas & Energy and Financial Services’ National Key Economic Areas (NKEA), as well as handling the Government’s Role in Business Strategic Reform Initiative (SRI). He is also the President and Chief Executive Officer of Malaysia Petroleum Resources Corporation (MPRC), an agency to promote, catalyse and transform the oil and gas services and manufacturing sector to become stronger entities in the industry.
Datuk Shahrol was the founding Managing Director and Chief Executive Officer of 1MDB.
Datuk Shahrol graduated from Stanford University in the United States of America
YBHG TAN SRI DATO’ PADUKA ISMEE ISMAIL
He sits on the Board of TH Plantations Berhad, which is the investment arm of Tabung Haji involved in the cultivation of oil palm, including processing and marketing of crude palm oil and related products. Lembaga Tabung Haji is also involved in property development through its subsidiary, TH Properties Sdn Bhd.
Tan Sri Dato’ Paduka Ismee holds directorships in a number of public and private companies, including Bank Islam Malaysia Berhad, its parent company BIMB Holdings Berhad and Syarikat Takaful Malaysia Berhad.
He was previously the Chief Executive Officer of ECM Libra Securities and Director of ECM Libra Capital Sdn Bhd. He had served several organisations in various capacities, including as Senior General Manager of Finance, Lembaga Tabung Haji; Chief Accountant at the national asset management company, Pengurusan Danaharta Nasional Berhad; and General Manager, Business Development of Arab Malaysian Development Berhad. He also held various positions in Shell Malaysia Berhad.
He is a Fellow of the Chartered Institute of Management Accountants (UK) and a Member of the Malaysian Institute of Accountants.
YBHG TAN SRI DATO' ONG GIM HUAT
Tan Sri Dato' Ong is active in community services, serving as Vice President and Trustee of Lam Wah Ee Hospital, Penang, a charitable and non-profit organisation which runs the 500-bed hospital. He sits on the Board of Governors of several National Type Chinese Schools in Penang. Among others, he is the Vice Chairman of Union High and Primary Schools, Penang, the Assistant Secretary of Penang Chinese Girls High and Primary Schools, Assistant Treasurer of Chung Hwa High and Primary Schools and Honorary Patron of Chung Ling High School, Penang and Butterworth.
He is actively involved in promoting the local economy of Penang. He is the Past Chairman of Real Estate and Housing Developers Association, Penang Branch, and is a member of the Trustee of Master Builders and Building Materials Suppliers' Association, Penang. He was also a Vice-President of Penang Chinese Chamber of Commerce from 1994 to 1998.
Tan Sri Dato' Ong graduated with a Bachelor of Commerce (Hons) from University of Manitoba, Winnipeg, Canada in 1976.
He was instrumental in transforming the Valiram Group from its traditional textiles business to luxury fashion, delivering cutting edge-retail concepts in the domestic and travel retail arena. His achievements include the opening of "first-to-market" brands and securing exclusive distributorship rights for iconic international brands across the region.
In late 1996, Ashvin’s innovation lead the group to break new ground in opening the world’s first retail store at an airport specialising in selling fabrics. Today, the Valiram Group has evolved into a growing retail conglomerate. The Group operates in 10 countries with 250 stores, representing 150 brands across Australia, China, Hong Kong, Indonesia, Macau, Malaysia, Philippines, Russia, Singapore and Thailand. The Valiram Group, with its headquarters in Malaysia, is one of the most prestigious specialist retailer in Southeast Asia.
Ashvin is an active member of the Entrepreneurs Organisation and has held the position of Vice-President of Duty Free Operators Association in Malaysia from 2003-2006.
He obtained a Bachelor of Science (BsBA) with double Majors in Finance and Accounting and a Minor in Economics from The American University, Washington D.C. He also attended the Monetary Economics & Business Strategy Summer Program at the Harvard Business School.