This article first appeared in The Edge Financial Daily, on April 19, 2016.

SINCE the news broke in March, speculation has been rife about CIMB Group Holdings Bhd chairman Datuk Seri Nazir Razak’s acknowledgment that he had helped his elder brother and Prime Minister Datuk Seri Najib Razak transfer US$7 million cash through his personal account to Barisan Nasional politicians before the general election in 2013.

Some took their hats off to Nazir when he confirmed as true The Wall Street Journal report that he had transferred US$7 million for Najib, although the acknowledgement has made some parties uncomfortable.

Nazir, who has been in the banking industry for more than 20 years, has reiterated that he had only done it as a favour for his brother. Following the disclosure, the banker has expressed regret at the action because since 2014, there has been a lot of controversy around state investment fund 1Malaysia Development Bhd (1MDB), in which Najib is the chairman of the advisory board.

“So I regret it because it has dragged me into that whole conversation. So I regret being part of that conversation. But as I said, there was nothing in the air in 2013, and I looked at what my brother asked of me — it was a favour — and it didn’t seem to involve anything illegal or any inappropriate use of my position, so I obliged. It is as simple as that,” he told the press yesterday.

Like it or not, the fact that Nazir is the top executive of the country’s second-largest banking group and wields much authority, has somehow added fuel to the speculation, including on the source of the funding, whether laws have been breached and to whom the money has gone.

To clear the air and more importantly to uphold corporate governance, the CIMB board has decided to hire Ernst & Young to conduct an independent review of the transfer of funds by Nazir.

During the period of the review, Nazir has taken a leave of absence, which started at the end of business hours yesterday, until the task is completed by the audit firm.

Nazir told the press conference yesterday that CIMB is not under any pressure to undertake the review. It is an initiative by CIMB’s board of directors to uphold corporate governance and transparency. The decision came after the special board meeting on April 5 to hear Nazir’s explanation on the incident.

The chairman of a banking group, who was then its chief executive officer, transferring money to politicians ahead of a general poll, which was one of the most bitterly contested elections in the country’s history, gives room for wild imaginations. It may be understandable that the public can’t help but think of possible wrongdoing against the backdrop of multiple probes into 1MDB at home and abroad.

Among the many controversies that are clouding the picture, Najib’s receipt of RM2.6 billion in donations into his personal account at AmBank Bhd is seen as controversial.

In comparison with a scenario in which a financial institution in such a situation does not take any action, the CIMB board’s initiative to conduct a review, and Nazir’s willingness to take a leave of absence to facilitate the process, would at least be a beam of light in the darkness.

From the perspective of corporate governance, it is the right step to take.