Malaysia election: Mahathir Mohamad win roils bond market

1MDB announced plans to break up assets and wind down operations in 2015, but Mahathir's win is fuelling speculation that its closure could be more certain

Malaysia’s controversial state-owned investment fund 1Malaysia Development Berhad (1MDB) came under pressure in the bond market this week after the nation’s landmark election raised questions about its future.

The vote ousted Najib Razak, who faced public anger over a money laundering scandal involving hundreds of millions of dollars siphoned from 1MDB. He has consistently denied wrongdoing. New Prime Minister Mahathir Mohamad said he thought he could recover most funds from 1MDB and that Najib will pay the consequences if the law finds any wrongdoing.

While the fund’s dollar bonds due 2023 rose 2.3 cents on the dollar Friday to 84.1 cents, they