All Nine Directors of Khazanah Board Quit, Leaves Leadership Decision to PM

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Azman Mokhtar, Mohd Nor, Nazir Razak and six others quit Khazanah board.

The entire Khazanah Nasional board of directors have submitted their resignation letters after reaching a unanimous decision that Tun Dr Mahathir Mohamad’s administration should determine the company’s new leadership structure.

“This is done in order to facilitate a smooth and orderly transition under the new Government.

“The current Board have been honoured to serve, and feels it appropriate to offer the new Government the discretion and reaffirm the prerogative to form the new Board,” the company said in a statement early this morning.

Khazanah added that it will issue another statement on its board once details are available.

Khazanah managing director Tan Sri Azman Mokhtar and eight other members of the sovereign wealth fund’s board decided to resign after a special board meeting on Tuesday (July 24).

The meeting chaired by Khazanah executive committee chairman Tan Sri Mohd Nor Mohd Yusof unanimously decided to sign undated resignation letters that were subsequently submitted to the Government.

It said the move to submit the undated letters was intended to give the Prime Minister the final say on who should remain or leave Khazanah.

The mass resignations follow Dr Mahathir’s purported public criticism against Khazanah two weeks ago in which he said the fund had deviated from the original purpose of its creation – to support Bumiputera equity in Malaysia.


Besides Azman and Mohd Nor, the board of directors include former banker Tan Sri Mohamad Azman Yahya; Datuk Mohammed Azlan Hashim; former central banker Tan Sri Andrew Sheng Len Tao, who previously served as the deputy chief executive of the Hong Kong Monetary Authority; Tan Sri Raja Arshad Raja Uda, former chairman and senior partner at PriceWaterhouseCoopers in Malaysia; Datuk Seri Nazir Razak, chairman of financial group CIMB Group Holdings Bhd and brother of former premier Datuk Seri Najib Razak; Datuk Nirmala Menon, a highly respected insurance sector executive; and banker Yeo Kar Peng.

Reportedlythe process of finding replacements will be closely followed by local and foreign investors.

There is strong speculation that any new leadership Dr Mahathir installs at Khazanah in the coming weeks will likely pursue management changes to the group’s stable of investments, which have a combined realisable asset value at end-2017 of RM157.2 billion and a net worth adjusted value of RM115.6 billion.

Bankers said it could create some uncertainty among foreign portfolio investors, who are major owners of shares in the Khazanah-related listed entities.

Khazanah holds stakes in Tenaga Nasional, Telekom Malaysia, Axiata Group, CIMB Group, Malaysia Airports Holdings, IHH Healthcare, UEM Sunrise Bhd and is the owner of Malaysia Airlines.

Dr Mahathir had previously lamented that Khazanah, the strategic investment fund of the Malaysian Government, which he set up in 1994 when he was prime minister for the first time, had deviated from its original intention of holding shares for bumiputras.

He claimed that instead, Khazanah had become a convenient vehicle for the previous government to reward politicians and non-professionals with positions and lucrative compensation packages.

“It is quite obvious now that they are doing all kinds of funny things. They are buying houses and they are taking over companies,” he said early this month.

Khazanah had later responded by saying it would seek clarification from Putrajaya on its mandate and investments.