1Malaysia Development Berhad

Country: Malaysia

Established: 2008

US$ Billion: 3.1

Origin: Oil

Transparency Rating: New

Previously called the Terengganu Investment Authority, the 1Malaysia Development Berhad ("1MDB")is a sovereign wealth fund of Malaysia. The Government has agreed to the set up the Terengganu Investment Authority. The purpose is to channel part of the oil royalty into a sovereign wealth fund which would be managed by professionals and supervised by foreign bankers and investors. Revenues earned by the Terengganu Investment Authority would help pad the state’s income when oil and gas resources were exhausted. Deputy Prime Minister Datuk Seri Najib Tun Razak said the Cabinet had agreed to the setting up of the authority with starting the fund with RM10 billion.

A portion of the funds will be allocated to invest locally and in other parts of Malaysia. The authority would be mandated to invest globally in bonds to ensure the state’s financial sustainability on a long-term basis.

News and Updates

Malaysia State Fund to Sell Islamic, Oil-Backed Bonds
Bloomberg reports that, "Terengganu Investment Authority Bhd., the first wealth fund set up by a Malaysian state, will sell 30-year Islamic bonds and may issue securities backed by oil royalties to raise a combined 11 billion ringgit ($3.1 billion).

Terengganu Investment Authority will price 5 billion ringgit of Islamic bonds next week, officials at the fund said in an interview today. The bonds will be guaranteed by the Malaysian government, whose debt is rated A3 by Moody’s Investors Service, the seventh-highest investment grade.

The fund 'won’t be rushing out to make risky investments' even as it seeks returns that are higher than its borrowing cost, Chief Executive Officer Shahrol Halmi, 38, said in a telephone interview from Kuala Lumpur. It is targeting annual returns of at least 15 percent, he added. 'We have a very long-term view in terms of managing our capital.'"
read more: Bloomberg

1. All figures quoted are from official sources, or, where the institutions concerned do not issue statistics of their holdings, from other publicly available sources.

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