I cannot in good conscience, continue if it affects the Bank’s image and reputation.
— Tan Sri Muhammad Ibrahim on his decision to quit
THE former Bank Negara governor has defended the central bank's decision to buy land from the previous administration in a deal valued at US$520 million. He contends that ‘everything was done with proper governance and accountability’. Finance Minister Lim Guan Eng says the money was allegedly used to pay off some of 1MDB’s debts.
PRIME Minister Tun Dr Mahathir Mohamad yesterday confirmed that Bank Negara Malaysia (BNM) governor Tan Sri Muhammad Ibrahim had submitted his resignation letter.
The cabinet, Dr Mahathir said, had accepted Muhammad’s offer to step down as BNM governor and his replacement would be announced only upon getting the royal consent from the Yang diPertuan Agong.
“This is why we cannot reveal who will replace Muhammad Ibrahim today (yesterday),” said Dr Mahathir after chairing the cabinet meeting.
He said the meeting with the Yang di-Pertuan Agong to get the royal consent for Muhammad's replacement would take place soon.
On reasons given for Muhammad’s decision to step down as BNM governor, Dr Mahathir said: “He (Muhammad) didn’t give any concrete reasons, but expressed his desire to resign.”
Muhammad was reported to have offered to resign from his post two years into his term.
Finance Minister Lim Guan Eng was reported to have raised questions about the central bank’s purchase of land from the previous administration.
Lim had said the previous administration had used money raised from a land sale to the central bank — valued at about US$520 million (RM2 billion) — to pay off some of 1Malaysia Development Bhd’s (1MDB) debts.
BNM had said the purchase was transacted at fair value and complied with governance requirements and relevant laws.
Muhammad was promoted to lead the central bank for a fiveyear term in May 2016 when Tan Sri Dr Zeti Akhtar Aziz, who was appointed by Dr Mahathir, stepped down after 16 years of leadership.
Two former deputy governors were likely candidates to replace Muhammad.
They are Datuk Nor Shamsiah Mohd Yunus and Dr Sukhdave Singh.
Nor Shamsiah, who joined the central bank in 1987, ended her term as deputy governor in November 2016.
Her responsibilities were primarily overseeing and ensuring the health of the banking sector, which is the core responsibility of the central bank in ensuring financial stability in the system.
Nor Shamsiah’s area of supervision also covered insurance and takaful companies, financial intelligence and enforcement, and talent management.
She was responsible for the finance and shared services of the central bank as well as BNM’s regional offices and BNMLink, a website that provides financial literacy to the public.
Nor Shamsiah was responsible for the formulation of banking regulations and policies for the orderly development of the Malaysian banking sector when she was the-then bank regulation department director.
She was involved in the financial sector resolution initiatives during the Asian financial crisis and the preparation and implementation of the Financial Sector Masterplan for the development of the Malaysian financial system from 2001 to 2010.
She is a Certified Practising Accountant and a graduate from the University of South Australia with a Bachelor of Arts Degree in Accountancy.
Sukhdave resigned in November
2017 after 31 years of service.
He joined the bank in 1986. He was responsible for the monetary and economics sector, as well as the organisational development sector of the central bank.
Sukhdave, who holds a PhD in Monetary and International Economics from Vanderbilt University in the United States, also had responsibility over regional integration initiatives and chaired regional task forces on financial and monetary cooperation.
BNM has two deputy governors — Shaik Abdul Rasheed Abdul Ghaffour and Jessica Chew Cheng Lian.