KUALA LUMPUR: Tan Sri Muhammad Ibrahim was willing to resign as Bank Negara Malaysia Governor in order to protect the central bank’s image and reputation.
In an internal message to BNM staff today, Muhammad said over the past few weeks, questions were raised if he had put at risk public confidence in the central bank.
“As a central bank, we are only as effective as the trust and confidence that the people of Malaysia and its leaders place in us.
“I am prepared to relinquish my post if I no longer have the strong trust and support of the public. I cannot in good conscience continue if it affects the Bank’s image and reputation,” Muhammad said.
Prime Minister Tun Dr Mahathir Mohamad confirmed at a press conference today that the central bank Governor had resigned. No replacement had been appointed yet.
In the message to staff, Muhammad said the central bank’s recent purchase of Lot 41, acquired at RM850 per square foot, had attracted wide public interest.
“The perception is that the purchase of the land was made to intentionally aid and abet the misappropriation of public funds pertaining to the corruption and scandal surrounding 1MDB. This is totally untrue,” he said.
Muhammad said BNM would never be party to such activities that would betray the public trust, and abhors any semblance of corruption and abuse of power.
“Skeptical as many may be, the Bank did not know nor did we have any control over the proceeds of the land purchase that would be used to settle 1MDB’s obligations,” he added.
Muhammad said the 1Malaysia Development Bhd (1MDB) scandal has cost the country dearly and as a Malaysian, he was deeply angered, distressed and outraged.
“This is indeed a matter of significant public focus and I can understand why any association with the scandal, unintended or otherwise, is invariably met with a strong sense of public outrage.
“My priority now is for the Bank to move forward and continue to focus on delivering its mandates to serve the Malaysian people,” he said.
In the message, Muhammad also explained the acquisition of 22.5ha land known as Lot 41 land, which was bought from the then Barisan Nasional federal government for RM2 billion.
“We ensured that everything was done in the right manner, with proper governance and accountability, including compliance with all relevant laws. Internally, we deliberated this at a number of Board meetings,” he said.
“We even recommended to the Government for the sale to be best done by way of a public tender which we would be glad to participate competitively in along with any other interests. We also chose to publish a press release in January 2018 to inform the public of the purchase in our effort to be transparent,” he said.
Muhammad explained that the land acquisition was also driven by BNM’s vision to establish a Financial Education Hub that will host among others, a global Islamic finance university, a Shariah academy and research centre, a financial services library, innovation labs, a cybersecurity operations centre and an integrated security command centre.
“With this objective in mind, we indicated our interest as early as September of 2016. We initiated the purchase of the land a year later when we knew that there was an emergent interest by the Government then to sell this land. We believe that it was an excellent opportunity to secure an asset on fair terms that will be central to sustain our future long-term growth,” said Muhammad.