Najib administration spent RM642m to bail out SRC International, govt official testifies

Kenneth Tee
The Finance Ministry’s Strategic Investment Department deputy secretary Afidah Azwa Abdul Aziz is pictured at the Kuala Lumpur High Court Complex June 19, 2019. — Picture by Firdaus Latif

KUALA LUMPUR, June 19 — Datuk Seri Najib Razak’s administration had bailed out SRC International Sdn Bhd for a total of RM642 million between November 2015 and December 2017 after the company failed to furnish its RM4 billion debt to the Retirement Fund Incorporated (KWAP), the High Court heard today.

Finance Ministry’s Strategic Investment Department deputy secretary Afidah Azwa Abdul Aziz testified that Najib’s Cabinet had approved three loans to SRC International of RM92 million, RM250 million and RM300 million, in order for the purpose of settling the company’s outstanding loan interest to KWAP.

She added that SRC International had applied for assistance from the Finance Ministry to avoid KWAP from declaring an “Event of Default (EOD)”.

“All three payments approved by the Cabinet and the Finance Ministry (MOF) were made directly from MOF to KWAP,” she said.

She said as far as she knew, SRC International had not made any payments for the RM642 million loaned to it by the federal government.

“As SRC International failed to settle its debt with KWAP, the government as the full guarantor of the RM4 billion loan must be responsible to make full principal payment including interests to KWAP,” she added.

Datuk Seri Najib Razak is pictured at the Kuala Lumpur High Court Complex June 19, 2019. — Picture by Firdaus Latif

She also explained that should an EOD be declared, KWAP as the borrower can terminate the loan agreement and given the rights to reclaim the full loan amount or amount guaranteed.

Subsequently, the federal government as the loan guarantor has to bear the full repayment and result in KWAP having to categorise the SRC loan as a doubtful loan.

During the course of the trial, witnesses have testified that KWAP granted a total of RM4 billion in loans in August 2011 and March 2012 to SRC International, with money allegedly flowing through other companies before being transferred into Najib’s accounts.

Afidah Azwa is the 41st prosecution witness of Najib’s ongoing trial involving seven charges of abuse of position, criminal breach of trust and money-laundering over RM42 million of SRC International’s funds.

MORE TO COME

Related Articles Lembaga pengarah SRC akan disingkir jika gagal patuh nasihat Najib, kata saksi Najib claimed no vested interest in SRC International during Cabinet meetings, says witness Najib’s Cabinet did not object to SRC International’s first loan of RM2b, court told