(May 15): CIMB Group Bhd Chairman Datuk Seri Nazir Razak said that the board of 1Malaysia Development Bhd (1MDB) should resign if they did not want to take active measures to address concerns over its finances, The Star reported today.

The brother of Prime Minister Datuk Seri Najib Razak said it was irresponsible for the debt-ridden state investment arm to do nothing and simply wait for the Auditor-General (A-G) to complete its investigation.

“The immediate check for a responsible board is to appoint an independent (auditor) now … otherwise the board and management, in my view, should resign," Nazir was quoted as saying.

”It is your basic responsibility. There is a complete mistrust in your financial situation. You have to responsibly deal with that. But instead you sit there and wait for the A-G.

“To me that is irresponsible. If you do that then it is better for you to step down and let someone else come in and take over."

Criticism has been mounting over the state investment vehicle, established in 2009, which has chalked up debts of up to RM42 billion.

Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah previously disclosed that Putrajaya had approved an RM950 million standby credit facility for 1MDB, of which RM600 million has been used.

Scrutiny grew more intense after whistleblower site Sarawak Report's exposes which piled pressure on Najib and prompted opposition politicians, former Umno leaders and anti-graft bodies to demand a thorough investigation into the fund.

On Wednesday, Singapore's Business Times reported that six foreign banks have turned "panicky" because their RM3.6 billion loan was secured by 1MDB's wholly owned Brazen Sky's US$1.103 billion, which is currently said to be parked at Swiss-based BSI Bank Singapore.

The business daily, quoting sources, said "securitisation document" for the loan was now deemed "incomplete", as one of the covenants was not fulfilled.

These meant lenders could demand for repayment from the state investment vehicle any time before its due date of end-August.

On April 22, Sarawak Report said 1MDB’s account in BSI Bank merely contained “paper assets”, the “true value of which cannot be determined”. – The Malaysian Insider