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Euromoney, January 2019

We have rarely sensed a mood so uncertain, paranoid and flat-out terrified as that in the Malaysian financial services industry in the days after Mahathir Mohamad returned as prime minister, ousting one-time protégé Najib Razak.

Najib, it is increasingly clear, ruled by fear, and you were either with him or against him. Those who took the former course thrived, but only until he lost an election.

Clearly Najib himself and his handbag-loving wife, Rosmah Mansor, had the most to lose from ceding power: Najib faces 32 charges on criminal breach of trust, money laundering and abuse of power, while Rosmah faces 17. But the shockwaves go well beyond the ruling couple to anyone who has ever appeared connected to them.

Within weeks of the election, resignations (or at least non-renewal of contracts) included Muhammad Ibrahim, governor of Bank Negara Malaysia; the entire board of sovereign fund Khazanah Nasional, including managing director Azman Mokhtar; several senior figures at oil utility and national jewel Petronas; and the top executives at Tabung Haji, which manages funds for Hajj pilgrimages.

From the outset Malaysia’s top bankers were looking nervous – and many of them still are, wondering about past connections to 1MDB projects. Clearly Goldman Sachs has plenty to worry about: Mahathir and his intended successor Anwar Ibrahim have called for Goldman to repay $600 million in fees from 1MDB and filed criminal charges.

In September it was confirmed that the former prime minister’s brother – and long-time critic – Nazir Razak would relinquish his role as group chairman of CIMB.  One senses that Mahathir, now 93, is loving every minute of it and that he has a few more scalps to claim yet.

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Chris Wright
Chris Wright
Chris is a journalist specialising in business and financial journalism across Asia, Australia and the Middle East. He is Asia editor for Euromoney magazine and has written for publications including the Financial Times, Institutional Investor, Forbes, Asiamoney, the Australian Financial Review, Discovery Channel Magazine, Qantas: The Australian Way and BRW. He is the author of No More Worlds to Conquer, published by HarperCollins.

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