PKR wants Affin owner to review TRX land buy, citing conflict of interest

TRX Affin propertyKUALA LUMPUR (Aug 12): PKR wants Armed Forces Fund Board (LTAT) to compel its associate company Affin Holdings Bhd and Affin Bank Bhd to review its recent purchase of land in 1Malaysia Development Bhd's (1MDB) Tun Razak Exchange (TRX) project, citing conflict of interest.

The opposition party vice youth chief Fahmi Fadzil (pictured) said the conflict of interest arises as Tan Sri Lodin Wok Kamaruddin, who is the Affin Holdings board of directors deputy chairman, is also 1MDB's board of directors chairman.

"It is very important for us to know whether Lodin had voted in the decision to purchase the land. He needs to give an explanation to dispel any negative perception on this issue," he said at a press conference at the PKR headquarters today.

Two days ago, LTAT-owned Affin Holdings Bhd's banking unit Affin Bank Bhd announced that the bank had acquired a tract of land in 1MDB's TRX to develop its new headquarters (HQ), for RM255 million.

According to Affin Bank managing director and chief executive officer (CEO) Kamarul Ariffin Mohd Jamil, the 0.51ha land bought at RM255 million means that the price per gross floor area would be RM309.67 per sq ft, while the plot ratio will be 15.2 times.

The land had been independently valued at RM262 million.

TRX is to be an international financial district and a major real estate project under government-owned investor 1MDB.

The acquisition has been described as "remarkable" by property consultant Savills Malaysia associate director Nabeed Hussain despite negatively impacting on Affin Holdings share price.

However, national news agency Bernama had reported Kamarul Ariffin as saying the issue of conflict of interest did not arise.

"He (Lodin) is not participating in the decision-making process. We are buying it for ourself," he was quoted as saying, adding that the company also did not need any approval from shareholders before making the acquisition.

Fahmi said the move by the bank to buy the land to build its new headquarters was "puzzling" and "suspicious", especially since it already had a "luxurious" headquarters on Jalan Raja Chulan.

He said Affin Holdings had previously announced that its after-tax profit for the financial year ending March 31, 2015 had dropped to RM34.8 million, compared with RM142.7 million for the same period in 2014.

"The financial performance of Affin Holdings and Affin Bank does not give confidence and reason for them to spend hundreds of million ringgit for a new office," he added.

This is not the first time the purchase of TRX land has created controversy.

Pilgrims' fund Lembaga Tabung Haji was accused of bailing out 1MDB when it acquired a 0.64ha land in TRX for RM188.5psf last April, which the former justified by saying the purchase was at a discount.

Public outcry against the purchase saw Tabung Haji chairman Datuk Seri Abdul Azeez Abdul Rahim announcing that it would sell the land and that there were interested buyers, but to date, the land has not been disposed of.

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