Share transfers to bail out BNM done ‘discreetly’

PUTRAJAYA: The share transfers from Telekom Malaysia Bhd and Tenaga Nasional Bhd (TNB) to Bank Negara Malaysia (BNM) to bail the central bank out of insolvency in 1994 was ordered to be done discreetly.

This directive for discretion was made by then “higher-ups of the Ministry of Finance”, former deputy finance secretary at the ministry’s finance department, Datuk Othman Jusoff, told the Royal Commission of Inquiry (RCI) yesterday.

Othman, 69, however, claimed that he could not remember who exactly made the directive despite prompts by conducting officer Datuk Suhaimi Ibrahim.

“You were the one who took notes of these meetings in which the decision was made to transfer Telekom Malaysia’s and TNB’s shares. You made a note that it should be done discreetly and yet, you say you can’t remember,” Suhaimi said.

Othman responded that he could not remember as it happened 25 years ago.

He said he would not remember that he took notes if he was not presented with documents during RCI proceedings stating that he did so.

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The documents were notes taken in a meeting on Nov 24, 1994 attended by BNM representatives (including former assistant governor Datuk Abdul Murad Khalid), ministry representatives (including former secretary-general Tan Sri Clifford Herbert) and Auditor General’s Office representatives.

The meeting was to discuss how the ministry could help bail out the then insolvent BNM.

It was decided that the share buyback of TM’s and TNB’s shares had to be done to prevent BNM from slipping into further losses, which at that point was somewhere north of RM8 billion.

The share transfers were to be done discreetly through Rashid Hussein Securities Sdn Bhd, now known as RHB Group.

RCI panellist Datuk Wira Kamaludin Md Said then asked Othman if the total RM31 billion losses were revealed at this meeting, to which the latter said “no”.

“And you didn’t ask? There is a directive to bail out BNM, but you didn’t ask how much they lost?” Kamaludin said incredulously.

Othman said: “I was a low-ranking junior officer. I didn’t ask questions. I just took notes.”

RCI panel member Datuk Seri Tajuddin Atan said: “Before this meeting, have there, to your knowledge, been any meetings being held where BNM came to (the ministry) seeking help?” Othman said “no”.

Tajuddin then asked: “Is it safe then to summarise that the people who needed to know already knew, discussions had already been made with all parties concerned and the next level of authority had been informed of this ‘packet’ (the share transfers of TM and TNB)?”

After a pause, Othman said “yes”.

Othman was the first witness during yesterday’s proceedings and the 22nd overall in the 10-day inquiry.