☕️ Syed Saddiq CBT, money laundering trial has begun
EPF Q1 2022 income down 17.8%. Singapore unveils SGD1.5 bil package to help low-income families (not using pension funds). Big 4 EY to split core businesses, list consulting arm raising USD10 bil.
1. MARKET SUMMARY
2. NUMBERS AT A GLANCE
1,299,348 children in Malaysia (36.6% of the child population) have been fully vaccinated against Covid-19. Meanwhile, Health Minister Khairy Jamaluddin (KJ) has encouraged people who qualify to take the second booster dose in preparation for the next wave. KJ expects the next wave will happen within two to three months.
RM15.85 bil — the total investment income of the Employees Provident Fund (EPF) in the first quarter of 2022, which is 17.83% lower YoY. With most markets underperforming in Q2 currently, I guess we can kiss the 6.1% dividend goodbye.
299.4kg (660lbs) — the weight of the world’s largest recorded freshwater fish, a giant stingray. The stingray, which measured almost four meters (13 feet) from snout to tail, was caught by a fisherman in the Mekong River.
3. IN MALAYSIA 🇲🇾
Domestic Trade and Consumer Affairs (KPDNHEP) Minister Alexander Nanta Linggi said ceiling price control for chicken and eggs and subsidies for bottled cooking oil would be discontinued from July 1. Nanta said the poultry industry players have given assurance that the prices would not increase drastically. Currently, it costs RM8.90 per kg for standard chicken and RM9.90 for a super whole chicken. Minister of Agriculture and Food Industries Ronald Kiandee expects the price per kg to be increased to RM11 or more (that’s a 23.5% increase — at what point does it become ‘drastic’?).
Muar MP Syed Saddiq Syed Abdul Rahman’s criminal breach of trust (CBT) and money laundering trial has a few interesting revelations:
Syed Saddiq discussed with members of a WhatsApp group on a statement to be issued about the missing money of RM250,000 from his home.
His parents think their son was under pressure to support then prime minister Muhyiddin Yassin. Syed Saddiq’s mother, Sharifah Mahani Syed Abdul Aziz, had developed cancer due to the stress she went through from the ordeal.
Details of the charges:
First charge — CBT of RM1 mil in funds belonging to Bersatu’s youth wing.
Second charge — Misappropriating the funds for himself.
Third and fourth charge — Money laundering of RM100,000 (two RM50,000 transactions).
Deutsche Bank (M) Berhad was urged to accelerate the transfer of USD1 bil from 1Malaysian Development Berhad (1MDB) as former prime minister Najib Razak wanted to make a press statement on the 1MDB joint-venture project with PetroSaudi International Ltd (PSI). The USD1 bil was transferred via two transactions — USD300 mil to an account belonging 1MDB-Petrosaudi, while the remaining USD700 mil went to the account of Good Star Limited (owned by Jho Low). Deutsche Bank highlighted the missing link after the transaction and also questioned 1MDB about the USD700 mil, but was told by its CEO Shahrol Azral Ibrahim Halmi that Good Star Limited was a subsidiary of PSI.
Shorts:
The Federal Territories Ministry has banned the entry of heavy vehicles exceeding 7.5 tons from entering the city centre (Kuala Lumpur) during peak hours (6:30 am to 9:30 am and 4:30 pm to 7:30 pm).
Another problem, another council — that’s how Malaysia solves its many problems. The Malaysia Climate Change Action Council will formulate a National Adaptation Plan (MyNAP) relating to the impact of climate change. We hope “flood-tourism” wouldn’t be one of them and the plan doesn’t nap.
Deputy Communications and Multimedia Minister Zahidi Zainul Abidin wants MACC to investigate Digital Nasional Berhad (DNB) and the 5G network the company is supposed to implement. Zahidi doesn’t want UMNO to be blamed for another possible potential 1MDB.
4. AROUND THE WORLD 🌎
Singapore unveiled a SGD1.5 bil (USD1.08 bil) package to help low-income families cushion rising global inflation, which will benefit 1.5 mil people. Some of the support: adults earning less than SGD34,000 (USD24,500) a year will receive SGD300 cash, each household gets SGD100 credit to offset utilities, and taxi drivers will get SGD100 to help with fuel hikes.
Where is the funding coming from? The government collected higher revenue due to strong economic recovery (not from retirement funds) and has spent less than what it had set aside for Covid-19-related measures (no corruption incident in its Covid-19 procurement process).
In the private sector, British company Rolls-Royce is giving 14,000 staff cash bonuses of GBP2,000 each and backdated pay rise of 4% to March this year to help them cope with rising living costs. This will benefit 11,000 factory staff and 3,000 junior managers.
Big 4 Ernst & Young is planning to split its audit and consulting business by listing its consulting arm through a share sale of 15% of the company for USD10 bil, valuing the consulting arm at USD66.7 bil and raising USD17 bil in debt. The IPO proceeds and debt will be utilised to pay off the firm’s auditing partners, which are expected to get a windfall of at least USD2 mil each. Its decision to break up comes as regulators step up the pressure on auditing firms to address conflicts of interest in their business as the consulting business could undermine their ability to conduct independent audits.
Ernst & Young has a 312,000 workforce globally and generated USD40 bil in revenue in 2021.
Softbank-backed Buy Now Pay Later (BNPL) giant Klarna Bank AB is said to be raising fresh funds at a USD15 bil valuation — a drastic drop from USD45.6 bil last June that it raised from SoftBank’s Vision Fund 2 that made it Europe’s most valuable fintech startup. Macro uncertainties, the rout in tech stocks and rising competition (Apple will be launching its own BNPL service) contributed to this down round. Klarna processed USD80 bil in 2021, up 42% from the previous year. However, losses 4x to USD250 mil and last month, it announced it would lay off 10% of its workforce.
There are ways to measure China-Taiwan tension. Goldman Sachs’s two indicators — the Cross-Strait Risk Index and Cross-Strait Risk Barometer have risen to the highest in the past decade, spiking in the past three months indicating rising tension with Russia’s invasion of Ukraine and China ratcheting its rhetoric toward Taiwan this month.
Hong Kong’s iconic floating restaurant, Jumbo, sank in the South China Sea due to “adverse conditions” after being towed away from Hong Kong (hope this leg of its journey is insured). The restaurant has been financially struggling with cumulative losses of HKD100 mil (USD12.7 mil) and decided to leave Hong Kong to an undisclosed location. The restaurant has been in the same spot since its opening in 1976 by late casino tycoon Stanley Ho and cost HKD30 mil (USD3.8 mil) to build.
Tencent announced that it will form an “extended reality” (XR) unit that will have 300 staff. The unit was formed earlier year, but little details were known about it. XR is basically augmented reality (AR) meets virtual reality (VR) to form the building blocks of the metaverse. Lots of marketing buzzwords here.
NASA will power down Voyager 1 and 2 probes this year to extend their lifespan to around 2030. Both launched in 1977 have pushed the boundaries of space exploration and were expected to last only four years. The probes are powered by radioactive plutonium, which is losing about 4 watts per year. Both probes are 12 bil and 14.5 bil miles away from Earth, making them the furthest two manmade objects from Earth, a record unlikely to be broken anytime soon.
The iconic “The Pale Blue Dot” photo taken by Voyager 1 at a distance of 3.7 bil miles | Source: NASA/JPL-Caltech
5. FOR YOUR EYES 👁👁
Our relationship in life with various people across time illustrated in lines
How hippos move underwater
