KUALA LUMPUR (May 23): Prime Minister Datuk Seri Najib Tun Razak said the Finance Ministry was not legally obligated to assume 1Malaysia Development Bhd's (1MDB) bonds, as there was no government guarantee or letter of support for the debt.

Najib, who is also finance minister, said this in a written reply to MPs' queries in Parliament on whether the ministry was legally obligated to assume US$3.5 billion (about RM14.25 billion) worth of 1MDB bonds, since International Petroleum Investment Co (IPIC) refused to honour the binding term sheet dated May 28, 2015.

MPs also asked Najib on the the dispute between 1MDB and IPIC.

Najib said: "Given the matter is still under dispute, the Ministry of Finance will wait for this issue to be fully resolved, before taking action against any party."

IPIC had in recent days made crucial announcements on 1MDB to the London Stock Exchange.

On April 18, 2016, IPIC said it had fulfilled its obligations under the binding term sheet. IPIC said its "obligations under the binding term sheet have terminated."

IPIC said on April 29 that IPIC had fully paid the US$50.31 million interest for 1MDB Energy (Langat) Ltd's US$1.75 billion 5.75% notes.

On May 11, IPIC said it paid the US$52.41 million interest for 1MDB Energy Ltd's US$1.75 billion 5.99% notes. Both 1MDB Energy (Langat) and 1MDB Energy bonds mature in 2022.

IPIC said it paid the interest for the 1MDB bonds, based on its "obligations under the guarantee of the notes". IPIC said it would recover the money from the Malaysian Government and 1MDB.