March 9, 2020 / 10:41 AM / a month ago

UPDATE 1-Malaysia's new PM names CIMB chief executive as new finance minister

(Writes through headline and lead to name new finance minister)

By Rozanna Latiff

KUALA LUMPUR, March 9 (Reuters) - Malaysia’s new Prime Minister Muhyiddin Yassin named the chief executive of CIMB Group as finance minister on Monday, and appointed a new head of the anti-graft commission investigating how billions of dollars went missing from sovereign fund 1MDB.

Sworn in a week ago, Muhyiddin emerged at the head of a new coalition after days of political chaos following the abrupt resignation of veteran leader Mahathir Mohamad late last month.

While Mahathir had led a multi-ethnic coalition, the new ruling coalition is dominated by conservative, ethnic Malay parties, notably the main losers in the 2018 election - the United Malays National Organisation (UMNO) and Islamist Parti Islam Se-Malaysia (PAS).

Announcing his cabinet, Muhyiddin picked Tengku Zafrul Tengku Abdul Aziz, the chief executive of Malaysian banking group CIMB, as finance minister, while also appointing senior UMNO and Islamist politicians to key posts.

Earlier on Monday, the prime minister’s office announced the appointment of Azam Baki as the new chief commissioner of the Malaysian Anti Corruption Commission, after the resignation of Latheefa Koya last week following Mahathir’s resignation.

Lateefa had spearheaded investigations of former premier Najib Razak and other UMNO leaders over how billions of dollars were allegedly siphoned off from state fund 1Malaysia Development Berhad (1MDB). Najib has denied all wrongdoing, describing the cases against him and his wife as politically motivated. Muhyiddin announced four new senior minister portfolios to oversee the economy, security, infrastructure development and education.

“With these senior ministers, there is no need for the time being for a deputy prime minister to be appointed,” Muhyiddin told a news conference.

The new lineup also includes Mustapa Mohamed, a former trade minister, as a minister in the prime minister’s department in charge of the economy.

Muhyiddin had earlier met with the king to present his list of cabinet appointees. Appointments of prime minister and cabinet members can only be made with the assent of the king.

The new coalition is expected to steer policies in favour of the country’s ethnic Malay majority, but the government’s immediate task will be to protect the export-focused economy from the impact of the coronavirus epidemic.

Malaysia has so far reported 99 cases of coronavirus infection.

The government has cut its growth forecast for this year and announced a 20 billion ringgit ($4.76 billion) stimulus package. The economy grew at its slowest pace in a decade in the fourth quarter.

The sharp fall in world oil prices, which intensified on Monday, will also be a drag on the country, the world’s third-biggest exporter of liquefied natural gas.

The change of leadership could help settle a diplomatic row with India, the biggest buyer of Malaysian palm oil, as New Delhi had taken exception to comments by Mahathir.

$1 = 4.2050 ringgit Reporting by Rozanna Latiff and Krishna N. Das; Editing by Simon Cameron-Moore

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