It is a purchase, not a bailout
Salleh Said Keruak
Lembaga Tabung Haji is said to have bailed out 1MDB by purchasing a certain asset owned by 1MDB.
The word ‘bailout’ is a negative term and has been intentionally used or misused to insinuate that there is something wrong going on.
When Bank Bumiputra Malaysia Berhad (BBMB) practically went bankrupt because of BMF’s bad loans in Hong Kong and Petronas was forced to pump in money to save the bank that would be considered a bailout.
Bailouts occur when money is pumped into the ailing organisation without any returns on that money. Neither do you receive dividends or do you get your money back.
Perwaja was a bailout because if money had not been pumped into that company then it would have gone under. Again, there were no returns on the money the government pumped into Perwaja.
When the government bought back the MAS shares from Tajudin Ramli that was a bailout. If the government had not bought the shares back then Tajuddin would have gone bankrupt and the government was forced to buy back the shares at way above market price thereby incurring a huge loss to the taxpayers.
