What the hell is going on?
Once again, that name is in the thick of things - Tan Sri Lodin Wok who is Chairman of 1MDB as well as a director of Affin Bank.
Tabung Haji and Boustead (where Lodin is Deputy Chairman & MD) own 55% of Affin, while Tabung Haji owns 57% of Boustead!! What an incestuous corporate set-up of GLC's!
But, in the current state of affairs where a sitting PM claims that $2.6 billion TT'd from abroad to his personal bank a/c was a "donation" and that he did not personally benefit from it, does anyone believe in these statements and denials?
Even assuming the price of $2,774 psf paid by Tabung Haji in May for their 1.56 acres of TRX land is fair, which we all agree is grossly inflated anyway, the price for Affin Bank's 1.26 acres should have been only about, say, $155 million.
So, there is an excess payment of $100 million ($255 -155 million)!!!!
Some claim this is for the increased plot ration of 16, which is a load of cobblers. With its Chairman Lodin's direct line to PM Najib and City Hall, Affin can apply for the increased plot ration on its own, at the cost of only making a formal application and architect's fees. That will come nowhere near $100 million.
Equally important is the question of the undue influence of "unseen hands" in concocting higher and higher land prices not transacted in the city, to bankroll 1MDB's acute cashflow deficit and inability to service its annual debt interest cost of about $2.5 billion!!
Is 1MDB due to make a $255 million interest payment in about 90 day's time. Is that how the land price was arrived at?
Does anyone really buy the statement that Affin has been negotiating with 1MDB for 3 years to conclude the deal at a record high price? That 2 GLC's needed 3 years to reach agreement so that Affin could buy land at the highest price in Malaysia? When 2 years ago Affin could have bought the land at about $1,000-1500 psf?
Some tend to think that no harm is done since Affin will be able to generate profits and create work for the building industry.
This is a false arguement, as it was with Tabung Haji's purchase. If parties are suspected of colluding to jack up land prices artificially to facilitate 1 party's urgent need for cash, that is a crime, twice over!
Twice over, because the party that buys at inflated prices will not be able to maximise its profits for the benefit of its shareholders, many of whom are soldiers, sailors, airforce crew, police personnel etc who defend our country and maintain law and order, and the haj brigade from the Malay heartland comprising farmers, fishermen, labourers, estate workers, clerks, retired pensioners on their last legs and the like who save every penny to make that one supremely important pilgrimage of their lives!
Have the Chairman, CEO and Board of Directors of these GLC's forgotten that they owe a fiduciary duty, AMANAH, to their brethren? To not cheat and rob them with fancy words, glossy brochures and $80 million APCO-inspired PR doublespeak?
Note too that the formal press announcement makes no mention of the price per square foot ($4,645) of land AT ALL!! This is deliberate as 1MDB knows that a comparison will be made by an already seething and furious public with the Tabung Haji purchase mess at $2,774 psf.
Next, there is the unusual announcement of price per gross floor area @ $310 psf, which is a red herring. Of course, with high-rise buildings, the higher you go, the cheaper the psf construction cost, and the higher the profit. But, as I have already said, Affin does not need to pay a whacking premium of $100 million to 1MDB for increased plot ratio; it can save a hundred million ringgit, and achieve it alone. In fact, it could go for a plot ration of 20 and achieve even higher profits without paying 1MDB 1 cent for it!!
The best comparison for barren land, apples to apples, is the ringgit per sq. ft. statistic, together with whether the land status is unconverted agricultural, commercial etc. No one can predict with any certainty construction cost and per sq. ft, floor area cost 1 year from now, especially with the ringgit plunging from $3.10 to $4 vs the US$ and $6.28 vs the British pound!
This is conduct bordering on treason by desperate men who do not have the gumption to stand up to a desperate, rogue Prime Minister. The Prime Minister and Minister of Finance, Najib, and the governor of Bank Negara, Zeti, should both resign or be booted out immediately for this financial mismanagement and fiasco of gargantuan proportions.
Naah, I don't think so.
The jaw-dropping numbers are, sadly, for real.