Malaysia’s central bank governor’s confirmation that she will step down in April when her term expires is likely to further hamper efforts in Malaysia to investigate a corruption scandal involving a state investment fund, analysts say.
Zeti Akhtar Aziz, who is 68 and has helmed Bank Negara Malaysia since 2000, is one of Asia’s most respected central bankers. Her long tenure, and close relations with international bankers like International Monetary Fund head Christine Lagarde, has helped stabilize the country’s financial markets and attract foreign investors to its stocks and bonds.
The central bank has been among the most aggressive domestic agencies in probing 1Malaysia Development Bhd., or 1MDB, a state fund set up by Prime Minister Najib Razak in 2009 to develop the economy. 1MDB, whose board of advisers is headed by Mr. Najib, is the focus of corruption investigations in Malaysia, the U.S., Singapore, Switzerland and Abu Dhabi. The Swiss attorney general last month said losses to Malaysian state-owned companies from the scandal could total $4 billion.
Ms. Zeti hinted last year she would stand down from Bank Negara and investors weren’t surprised after she confirmed the move in remarks Wednesday at an event in Kuala Lumpur, Malaysia’s capital. The ringgit currency traded 1% higher Thursday.
Whoever succeeds Ms. Zeti is likely to be under huge pressure from Mr. Najib’s government to ensure Bank Negara does not aggressively scrutinize 1MDB, said James Chin, a political analyst at the University of Tasmania.