From Malaysia Chronicle
KUALA LUMPUR – 1Malaysia Development Berhad (1MDB) is experiencing “short term” cashflow problem with the ability to pay its debts, said Finance Minister II Datuk Seri Husni Hanadzlah.
He assured that the Government would find a solution for the debt-laden government investment arm.

“The problem is a short term cashflow problem, that is all.
“We will settle it. In terms of asset quality, they have the assets to pay all. It is only a short term cashflow problem,” he told reporters at Parliament lobby, Thursday.
Husni said 1MDB might have misinterpreted the investment of US$1.103bil (RM4bil) in BSI Bank (Singapore) Ltd.

“There’s a mistake. They (1MDB) had the impression that there was cash when they redeemed the funds. Actually, that is a saving,” said Husni.

Husni was commenting on contradicting Dewan Rakyat written replies by the ministry to DAP lawmaker Tony Pua, who queried whether 1MDB still had the cash in the Singapore bank.
In January, the Finance Ministry said 1MDB had deposited the funds it redeemed from its offshore account in the Cayman Islands into BSI Bank, with the amount held in US dollars.

On March 10, it confirmed in a written reply to Pua that the funds were held in the Singapore bank in the form of cash.

On May 19, however, the Government said the funds were not in the form of cash, but assets.
When asked, Husni did not elaborate on the form of assets the company had, but stressed that the saving was in the form of “units.”

“Units, just units,” he said, refusing to explain the nature of units when pressed further.
Husni said the units were backed by sovereign wealth funds and the Government hoped they could repatriate the funds as soon as possible.

He also assured that the company would not head for a default.

“A default will cause systemic effect and we do not want that,” he said.

He said he was in the midst of completing a report on 1MDB’s restructuring plan for the Cabinet next week.

“We have had discussions (with 1MDB) and their position is very clear. We have our plans there and it’s very concrete,” he said. – ANN

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Related story:
‘HUSNI ON DRUGS OR SLEEPING ON THE JOB’: MP slams minister for ‘duping’ M’sians with talk of 1MDB ‘units’

From Malaysia Chronicle

PETALING JAYA – The new money in town, according to Second Finance Minister Ahmad Husni Hanadzlah, is “units”, notes Raub MP Ariff Sabri Abdul Aziz in his latest blog posting. “We can hazard a guess that these units are probably a form of new money used by the rogues of the world.
If so, what’s there for Bank Negara to monitor?” Ariff confesses that he doesn’t understand a thing about these units, which are not US dollars, as earlier claimed, and which are supposedly kept by 1MDB in Singapore and which would be “brought back”.
“Is Husni taking air ketum (drug laced water) or sleeping on the job?” he asks.
“The English say it’s getting more bizarre by the day. It’s getting curiouser and curiouser, as in Alice in Wonderland.”
Ariff’s article refers to Husni’s claim that the 1MDB “assets” in Singapore are units backed by sovereign wealth funds. “Benda apa pulak ni (What in the world is this thing)?” he asked. “Can’t the government be upfront and direct? I don’t know what these units are.

Please explain.” Also, Ariff wants Husni to elaborate on his reference to sovereign wealth funds. “Is Husni digging a hole to cover another hole? What’s he going to bring back from Singapore?”

He says he was also taken aback by Husni’s statement that Putrajaya misinterpreted the “units” redeemed from the Cayman Islands by 1MDB and kept in Singapore as US dollars. He wants to know who misinterpreted the so-called units as USD.

He wants Husni to confirm whether officials at the Ministry of Finance “misinterpreted” the so-called units as USD. He thinks that Husni has managed to confuse everyone with his talk of “units” and given them a severe headache. “Perhaps it’s the work of leaders to twist things around.
Even so, they need to explain what these units are so that the confusion among the public can end.” Revisiting Husni’s claim that the units would be brought back from Singapore, he says he is left wondering how something that doesn’t belong to 1MDB can be brought back.
He points out that 1.103 billion units have apparently been used as security to borrow RM3.6 billion from a syndicate of six banks led by Deutsche Bank and they would have lien on them.
News reports have quoted Husni as saying that 1MDB had 2.318 billion units in Singapore’s BSI Bank worth USD2.318 billion, all backed by sovereign wealth funds. 1MDB apparently used 1.215 billion units to repay its loans and pledged some with Deutsche Bank in Singapore as security for RM3.6 billion in loans. The repayment also went to Aabar Investments, an Abu Dhabi Government-owned company. 1MDB still has 1.103 billion “units” and these would be “brought back”. – FMT
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See iNews related story with links published May 21 2015 “It was a mistake, Putrajaya admits after confusion over 1MDB’s Cayman assets” at: http://www.ieyenews.com/wordpress/it-was-a-mistake-putrajaya-admits-after-confusion-over-1mdbs-cayman-assets/