1MDB scandal: Goldman, Malaysia agree on $3.9-billion settlement

Bank to make $2.5-bn cash payment to Malaysia within 10 days, in exchange for having criminal charges dropped

The $3.9-billion 1MDB settlement that Malaysia struck with Goldman Sachs Group provides a timely boost to the government’s coffers just as it faces soaring debt.

The payout equates to nearly one-third of last year’s budget deficit, and 1.07 per cent of 2019 gross domestic product, according to estimates from Bloomberg Economics’ Tamara Mast Henderson. The amount is “quite significant” and could help the government finance its fiscal stimulus program, said Mohd Afzanizam Abdul Rashid, chief economist at Bank Islam Malaysia Bhd.

As part of the deal finalised Tuesday, Goldman must make a $2.5-billion cash payment to Malaysia within 10 days