| State investment fund 1Malaysia Development Bhd's bond default payment last month is not likely to lead to a crystallisation of the existing guarantee obligations of the Malaysian sovereign for 1MDB securities affected by cross-defaults, says Fitch Ratings. There is little risk to the sovereign credit profile as yet, said its analysts, adding that the risk lies more in the potential for the affair to weaken policy focus or contribute to political instability.
1MDB missed a US$50 million coupon payment on a 5.75 per cent bond due in 2022 but International Petroleum Investment Corp (IPIC), Abu Dhabi's sovereign wealth fund which had guaranteed the bonds under a debt-for-asset swap agreement, subsequently made the payment...............................................Full Article: Source
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