1MDB pays coupon on debt af­ter miss­ing two pay­ments

The Pak Banker - - FRONT PAGE -

KUALA LUMPUR: Malaysia's trou­bled state in­vest­ment com­pany 1Malaysia De­vel­op­ment Bhd. paid the coupon on its Is­lamic debt af­ter miss­ing two pay­ments on other se­cu­ri­ties ear­lier. 1MDB un­der­took the sched­uled pay­ment of 143.8 mil­lion ring­git ($34.9 mil­lion) on its 5 bil­lion ring­git 5.75 per­cent notes due 2039, ac­cord­ing to an e-mailed state­ment.

The com­pany had pre­vi­ously missed the coupons for two sets of dol­lar-de­nom­i­nated bonds amid a dis­pute with Abu Dhabi's In­ter­na­tional Pe­tro­leum In­vest­ment Co., which had guar­an­teed the debt. That led to a de­fault by 1MDB in April, adding to the fi­nan­cial scan­dals for the com­pany that is al­ready a tar­get of global in­ves­ti­ga­tions into al­le­ga­tions of money laun­der­ing and em­bez­zle­ment. 1MDB has con­sis­tently de­nied wrong­do­ing.

"1MDB has am­ple liq­uid­ity to make in­ter­est pay­ments and ser­vice its cur­rent debt obli­ga­tions," Pres­i­dent Arul Kanda said on Mon­day. "1MDB re­it­er­ates that, not­with­stand­ing the dis­pute with IPIC, it will con­tinue to honor cur­rent debt obli­ga­tions." The pay­ment was ex­pected, as 1MDB has been clear it would pay obli­ga­tions on notes guar­an­teed by it­self and the gov­ern­ment rather than by IPIC, ac­cord­ing to S&P Global Rat­ings an­a­lyst YeeFarn Phua. "I think they are sim­ply do­ing what they are say­ing," Sin­ga­pore­based Phua said.

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