Malaysia's Najib Razak appeared to raise doubt on Thursday that his mentor-turned-foe Mahathir Mohamad would succeed him as prime minister following the stunning defeat of his ruling coalition in the country's general election.
Najib said he accepted the "verdict of the people" in Wednesday's election, which was won by an alliance of parties led by Mahathir, a 92-year-old who ruled the country with an iron fist as prime minister from 1981 to 2003.
However, he told a news conference that, since no single party had won a simple majority of seats in the 222-member parliament, it would be up to the country's constitutional monarch to decide who should be the next prime minister.
Official results showed that Mahathir's Pakatan Harapan (Alliance of Hope) coalition - which is made up of four parties - won 113 seats, one more than the number required to rule.
However, Pakatan Harapan is not formally registered as a coalition. The party in Mahathir's alliance that won the most seats was the People's Justice Party (PKR), which is headed by the wife of jailed political leader Anwar Ibrahim.
Some political analysts said this could mean that Anwar's wife, Wan Azizah Wan Ismail, becomes prime minister.
Alternatively, Najib could try to argue that his party - the United Malay National Organisation (UMNO) - has the largest number of seats and should be offered the chance to rule as a minority government.
UMNO won 54 seats in the election and PKR took 42.
UMNO is the dominant party in Najib's Barisan Nasional (BN) coalition, which has ruled Malaysia without interruption for the six decades since independence from Britain. The BN coalition took 79 seats.
Najib's comments on the issue of who succeed him added to uncertainty after a spokesman for the king's palace said Mahathir would not be sworn in as prime minister on Thursday.
Mahathir said after declaring victory overnight that the king would sign his letter of appointment on Thursday.
Market jitters ahead
Few had expected Mahathir to prevail against a coalition that has long relied on the support of the country's ethnic-Malay majority.
However, he joined hands with Anwar, his one-time protege, and together their alliance exploited public disenchantment over the cost of living and a multi-billion-dollar scandal that has dogged Najib since 2015.
Mahathir has promised to seek a royal pardon for Anwar if they win the election and, once Anwar is free, to step aside and let him become prime minister.
The stunning election outcome was expected to ruffle financial markets that had been expecting a comfortable win for Najib and the BN.
Malaysia's currency weakened in offshore trading on Thursday, with the ringgit one-month non-deliverable forward falling 1.7 per cent. The US-traded iShares MSCI Malaysia ETF fell 6 per cent.
The national stock market was closed on Thursday and Friday after Mahathir declared a public holiday, but the ringgit currency weakened in offshore trading.
Mahathir has promised to reverse a goods and services tax (GST) introduced by Najib during his first 100 days in power and review foreign investments.
Global ratings agency Moody's said some of his campaign promises, including the GST and a reintroduction of fuel subsidies, could be credit negative for Malaysia's sovereign debt rating.
Mahathir was once Najib's mentor but they clashed after differences over the 1MDB graft scandal, in which billions of dollars were allegedly siphoned off to foreign countries.
The scandal is being investigated by at least six countries, although Malaysia's attorney general cleared Najib of any wrongdoing.
Mahathir vowed to investigate the scandal if elected and to bring the funds back to Malaysia.
