KUALA LUMPUR (May 4): Malaysia will dissolve the advisory board of a state-owned investment company headed by Prime Minister Najib Razak as the government accepts the resignation of the board amid global investigations into allegations of money laundering and embezzlement.

The Minister of Finance Inc, the shareholder of 1Malaysia Development Bhd or 1MDB, has accepted the resignation of the board of directors with effect from May 31, according to an e-mailed statement from the Finance Ministry on Wednesday. Arul Kanda will remain as the company’s president until further notice, the ministry said.

The decision came as the government’s reputation took another hit last week after 1MDB defaulted on a US$1.75 billion bond. The development fund withheld a US$50 million coupon payment amid a wider dispute with Abu Dhabi’s International Petroleum Investment Co or IPIC, the co-guarantor of the bonds, and the missed payment triggered cross defaults on 7.4 billion ringgit ($2.5 billion) of 1MDB debt.

To continue reading,

Sign in to access this Premium article.

Subscription entitlements:

Less than $9 per month
3 Simultaneous logins across all devices
Unlimited access to latest and premium articles
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)

Stay updated with Singapore corporate news stories for FREE

Follow our Telegram | Facebook