By Chan Quan Min
The mysterious fund managing RM7.18 billion in expatriated funds belonging to 1Malaysia Development Bhd (1MDB) is Hong Kong based Bridge Partners, revealed The Business Times (Singapore) in a report Monday.
The identity of the fund manager was not disclosed by the state-owned strategic investment fund and was unknown until this revelation.
According to the news report, the Cayman Islands funds are held in a segregated portfolio company (SPC) there called Bridge Global Absolute Return Fund, purportedly managed by Bridge Partners of Hong Kong.
Bloomberg data on the Bridge Global Absolute Return Fund lists a one-year return of 5.76%, matching the figure stated in 1MDB’s latest audited accounts for the financial year ended March 2013.
The investment was allegedly made through Brazen Sky Ltd, another little-known company incorporated in the British Virgin Islands, which like the Cayman Islands is a known tax haven.
The Business Times (Singapore) attributes the discovery of the identity of the fund manager to documents sighted by the newspaper.
The same documents reportedly detail how 1MDB’s investments in the Cayman Islands are further divided into six classes of shares of unlisted open-ended funds focused on the energy sector.
Bridge Partners, the fund manager, is led by a team comprising managing director Monica Lin and director Lobo Lee, according to the company’s website.
According to his profile on the Bridge Partners website, which has been taken down but still available as a cached file at this link, Lee previously served as the senior vice president of Hong Kong Exchanges and Clearing Ltd.
The Business Times (Singapore) obtained documents further revealed that a Swiss private bank in Singapore produced portfolio statements on 1MDB’s Cayman Islands funds. The news report speculated that this was done “possibly to indicate that the funds are genuine.”
The latest revelation partly explains why 1MDB directors were forced to admit that they had no control over the RM7 billion in the Cayman Islands as the investment was made, to put it simply, in an off-the-shelf financial instrument.
This tranche of RM7 billion has had a complicated history, having previously been pledged as an 11-year loan to PetroSaudi International in 2012 for a higher fixed return than it is currently yielding. The said funds made their way to the Cayman Islands after 1MDB allegedly terminated and redeemed the loan.
In April 2013, KiniBiz investigated the complex paper trail of 1MDB’s mysterious loans to PetroSaudi and later, with the same cash, its investments in the Cayman Islands SPC and found more questions than answers in 1MDB’s shady dealings.
Separately, The Edge Financial Daily today reported that 1MDB’s Goldman Sachs banker, Malaysian Roger Ng, has quit the infamous company to “do his own thing.” The paper profiled Ng as politically connected, with a hand in the issuance of some RM8 billion (RM25.8 billion) worth of bonds by Malaysian entities, in another indication of 1MDB’s unexplainable intimacy with Goldman Sachs.
If not for paper revaluation gains of its Kuala Lumpur landbank, 1MDB would have made a loss of RM1.85 billion in the financial year ended March 2013.
In the 12 months between March 2012 and March 2013, 1MDB grew in size multiple times to ended that last reported financial year with RM23.6 billion in near-liquid assets and even larger borrowings of RM36.3 billion.
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